THE DELHI SALES TAX ACT, 1975                                                                                                                                        

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ARRANGEMENT OF SECTIONS                                                                                                            

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CHAPTER I 

PRELIMINARY 

SECTIONS 

1. Short title, extent and commencement. 

2. Definitions. 

CHAPTER II 

INCIDENCE AND LEVY OF TAX 

3. Incidence of tax. 

4. Rate of tax. 

5. Power of Administrator to prescribe points at which goods may be taxed. 

6. Burden of proof. 

7. Tax-free goods. 

8. Certain sales and purchases not liable to tax. 

CHAPTER III 

SALES TAX AUTHORITIES AND APPELLATE TRIBUNAL 

 9. Sales tax authorities. 

10. Delegation of Commissioner’s powers. 

11. Power to transfer proceedings. 

12. Disputes regarding territorial jurisdiction. 

13. Appellate Tribunal. 

CHAPTER IV 

REGISTRATION, AMENDMENT AND CANCELLATION 

14. Registration. 

15. Voluntary registration. 

16. Provisional registration. 

17. Special registration. 

18. Security from certain class of dealers. 

19. Amendment of certificate of registration. 

20. Cancellation of certificate of registration. 

CHAPTER V 

RETURNS, ASSESSMENT, RECOVERY AND REFUND OF TAX 

21. Periodical payment of tax and filing of returns. 

22. Collection of tax only by registered dealers. 

23. Assessment. 

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SECTIONS 

24. Turnover escaping assessment. 

25. Payment and recovery of tax. 

26. Continuation of certain recovery proceedings. 

27. Interest. 

28. Special model of recovery. 

29. Lump sum payment of tax. 

30. Refund. 

31. Set-off. 

CHAPTER VI 

LIABILITY IN SPECIAL CASES 

32. Liability in case of transfer of business. 

33. Liability in case of company in liquidation. 

34. Liability of partners of firm to pay tax. 

35. Liability of guardians, trustees, etc. 

36. Liability of Court of Wards, etc. 

37. Liability in other cases. 

LIABILITY TO PRODUCE ACCOUNTS AND SUPPLY OF INFORMATION 

CHAPTER VII 

38. Accounts. 

39. Memoranda of sales. 

40. Information to be furnished regarding change of business. 

41. Production and inspection of accounts and documents and search of premises. 

42. Power of Commissioner and other authorities to take evidence on oath, etc. 

CHAPTER VIII 

APPEALS, REFERENCE AND REVISION 

43. Appeals. 

44. Non-appealable orders. 

45. Statement of case to the High Court. 

46. Revision of orders prejudicial to revenue. 

47. Revision of other orders. 

48. Rectification of mistakes. 

49. Determination of disputed questions. 

50. Offences. 

51. Offences by companies. 

CHAPTER IX 

OFFENCES AND PENALTIES 

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SECTIONS 

52. Cognizance of offences. 

53. Investigation of offences. 

54. Composition of offences. 

55. Imposition of Penalty. 

56.  Penalty  for  concealment  of  sales  or  furnishing  inaccurate  particulars  or  making  false 

representations. 

57. Penalty for contravening provisions regarding collection of tax by dealers. 

CHAPTER X 

MISCELLANEOUS 

58. Service of notice when family is disrupted or firm is dissolved. 

59. Service of notice in the case of discontinued business. 

60. Appearance before any authority in proceedings. 

61. Change of an incumbent of an office. 

62. Extension of period of limitation in certain cases. 

63. Returns, etc., to be confidential. 

64. Setting up of check-posts and barriers. 

65. Publication of names, etc., of dealers whose certificates of registration are cancelled. 

66. Exemptions. 

67. Bar of suits in civil courts. 

68. Transfers during pendency of proceedings void. 

69. Chapter XXXVI of the Code of Criminal Procedure, 1973, not to apply to certain  offences. 

70. Application of the provisions of the Delhi Land Reforms Act, 1954 for purposes of recovery 

of sales tax recoverable as arrears of land revenue. 

71. Power to make rules. 

72. Rules to be laid before Parliament. 

73. Repeal and savings. 

74. Removal of difficulties. 

75. Transitional provisions. 

THE FIRST SCHEDULE. 

THE SECOND SCHEDULE. 

THE THIRD SCHEDULE. 

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 THE DELHI SALES TAX ACT, 1975 

ACT NO. 43 OF 1975 

An Act to consolidate and amend the law relating to the levy of tax on sale of goods in the Union 

territory of Delhi. 

BE it enacted by Parliament in the Twenty-sixth Year of the Republic of India as follows:— 

[7th August, 1975.] 

CHAPTER I 

PRELIMINARY 

1.  Short  title,  extent  and  commencement.—(1)  This  Act  may  be  called  the  Delhi  Sales  Tax        

Act, 1975. 

(2) It extends to the whole of the Union territory of Delhi. 
(3)  It  shall  come  into  force  on  such  date1  as  the  Administrator  may,  by  notification  in  the  Official 

Gazette, appoint. 

2. Definitions.—In this Act, unless the context otherwise requires,— 

(a)  “Administrator”  means  the  Administrator  of  Delhi  appointed  by  the  President  under        

article 239 of the Constitution; 

(b) “Appellate Tribunal” means the Appellate Tribunal constituted under section 13; 

(c) “business” includes— 

(i) any trade, commerce or manufacture or any adventure or concern in the nature of trade, 
commerce  or  manufacture  whether  or  not  such  trade,  commerce,  manufacture,  adventure  or 
concern is carried on with a motive to make gain or profit and whether or not any gain or profit 
accrues from such trade, commerce, manufacture, adventure or concern; and 

(ii)  any  transaction  in  connection  with,  or  incidental  or  ancillary  to,  such  trade,  commerce, 

manufacture, adventure or concern; 

(d)  “Commissioner”  means  the  Commissioner  of  Sales  Tax  appointed  under  sub-section  (1)  of 

section 9; 

(e) “dealer” means any person who carries on business of selling goods in Delhi and includes— 

(i) the Central Government or a State Government carrying on such business; 

(ii) an incorporated society (including a co-operative society), club or association which sells 
or  supplies  goods,  whether  or  not  in  the  course  of  business,  to  its  members  for  cash  or  for 
deferred payment or for commission, remuneration or other valuable consideration; 

(iii) a manager, factor, broker, commission agent, del credere agent, or any mercantile agent, 
by whatever name called, and whether of the same description as hereinbefore mentioned or not, 
who sells goods belonging to any principal whether disclosed or not; and 

(iv) an auctioneer who sells or auctions goods belonging to any principal, whether disclosed 
or not and whether the offer of the intending purchaser is accepted by him or by the principal or a 
nominee of the principal; 

(f) “Delhi” means the Union territory of Delhi; 

(g) “goods” includes all materials, articles, commodities and all other kinds of moveable property, 

but does not include newspapers, actionable claims, stocks, shares, securities or money; 

1.  21st  October,  1975,  vide  Delhi  Administrator  notification  No.  F.  4-61-1975-  F  in  (General)  (i),  dated  10th  October,  1975, 

Published in Delhi, see Gazette of India, Extraordinary, dated 10th October, 1975, Part IV. 

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(h)  “manufacture”,  with  its  grammatical  variations  and  cognate  expressions, means  producing, 
making, extracting, altering, ornamenting, finishing or otherwise processing, treating or adapting any 
goods, but does not include any such process or mode of manufacture as may be prescribed; 

(i) “Official Gazette” means the Delhi Gazette; 

(j) “prescribed” means prescribed by rules made under this Act; 

(k) “registered” means registered under this Act; 

(l)  “sale”,  with  its  grammatical  variations  and  cognate  expressions, means  any  transfer  of 
property  in  goods  by  one  person  to another for  cash  or  for  deferred  payment  or  for other valuable 
consideration, and includes— 

(i) a transfer of goods on hire-purchase or other system of payment by instalments, but does 

not include a mortgage or hypothecation of, or a charge or pledge on, goods; 

(ii)  supply  of  goods  by  a  society  (including  a  co-operative  society),  club,  firm  or  any 
association  to  its members  for  cash  or  for  deferred  payment,  or  for  commission,  remuneration 
or other valuable consideration, whether or not in the course of business; and 

(iii) transfer of goods by an auctioneer referred to in sub-clause (iv) of clause (e); 

(m) “sale price” means the amount payable to a dealer as consideration for the sale of any goods, 
less  any  sum  allowed  as  cash  discount  according  to  the  practice  normally  prevailing  in  trade,  but 
inclusive of any sum charged for anything done by the dealer in respect of goods at the time of or 
before the delivery thereof other than the cost of freight or delivery or the cost of installation in cases 
where such cost is separately charged; 

(n) “tax” means sales tax payable under this Act; 

(o)  “turnover” means  the  aggregate  of  the  amounts  of  sale  price  receivable,  or,  if  a  dealer  so 
elects,  actually  received  by  the  dealer,  in  respect  of  any  sale  of  goods  made  during  any  prescribed 
period  in  any  year  after  deducting  the  amount  of  sale  price,  if  any,  refunded  by  the  dealer  to  a 
purchaser  in  respect  of  any  goods  purchased  and  returned  by  the  purchaser  within  the  prescribed 
period: 

Provided that an election as aforesaid once made shall not be altered except with the permission 

of the Commissioner and on such terms and conditions as he may think fit to impose; 

(p) “year” means the financial year. 

CHAPTER II 

INCIDENCE AND LEVY OF TAX 

3.  Incidence  of  tax.—(1)  Every  dealer  whose  turnover  during  the  year  immediately  preceding  the 
commencement of this Act exceeds the taxable quantum and every denier who at the commencement of 
this Act, is registered or is liable to pay tax under the Central Sales Tax Act, 1956 (74 of 1956), shall be 
liable to pay tax under this Act on all sales effected by him on or after such commencement. 

(2) Every dealer to whom sub-section (1) does not apply, shall— 

(i) with effect from the date immediately following the day on which his turnover calculated from 
the commencement of any year first exceeds within such year the taxable quantum, be liable to pay 
tax under this Act on all sales effected by him after that day; 

(ii)  if  he  becomes  liable  to  pay  tax  under  the  Central  Sales  Tax  Act,  1956  (74  of  1956)  or  is 
registered as a dealer under the said Act at any time after the commencement of this Act, be liable to 
pay tax on all sales effected by him or on his behalf within Delhi on or after the date he becomes so 
liable or is registered under the said Act, whichever is earlier. 

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(3) Every dealer who has become liable to pay tax under this Act shall continue to be so liable until 
the expiry of three consecutive years during each of which his turnover has failed to exceed the taxable 
quantum and such further period after the date of such expiry as may be prescribed and on the expiry of 
such further period his liability to pay tax shall cease: 

Provided that any dealer may, after the expiry of one year following the year in which his turnover 
has failed to exceed the taxable quantum, apply for the cancellation of his certificate of registration, and 
on such cancellation, his liability to pay tax shall cease: 

Provided  further  that  in  respect  of  any  goods  purchased  by  any  dealer  before  the  date  of  such 
cancellation and remaining unsold or unutilised for the purpose for which they were purchased, he shall 
be liable to pay so much of tax as would have been payable had he not been registered as a dealer on the 
date of purchase of such goods. 

(4) Every dealer whose liability to pay tax under this Act has ceased under sub-section (3), shall, if 
his turnover calculated from the commencement of any year again exceeds the taxable quantum on any 
day within such year, be liable to pay such tax with effect from the date immediately following the day on 
which his turnover first exceeds the taxable quantum, on all sales effected by him after that day. 

(5)  Any  dealer  whose  certificate  of  registration  has  been  cancelled  under  sub-section  (3)  of       

section 20, shall—  

(a) if his turnover calculated from the date of cancellation of such certificate exceeds the taxable 

quantum on any day within the year; or 

(b)  if his  turnover  calculated  from  the  commencement  of  any subsequent  year,  exceeds  the 

taxable quantum on any day within the year, 

be liable to pay tax under this Act with effect from the date immediately following the day on which such 
turnover  again  first  exceeds  the  taxable  quantum  on  all  sales  effected  by him  after  that  day  of  goods 
imported  by him  from  outside  Delhi  or  manufactured  by him  in  Delhi  or  purchased  by him  without 
payment of tax leviable under this Act. 

(6)  No  dealer  who  deals  exclusively  in  one  or  more  classes  of  goods  specified  in  the  Third 

Schedule shall be liable to pay any tax under this Act. 

(7) For the purposes of this Act, “taxable quantum” means, — 

(a) in relation to any dealer who imports for sale any goods into Delhi.  .     .      .     .     Nil, 

(b)  in  relation  to  any  dealer  who  manufactures  goods  for  sale  regardless  of  the  value  of  goods 

manufactured .              .          .          .              .              .           .             .            . Rs.    30,000.00, 

(c) in relation to any other dealer   .            .              .           .             .            . Rs. 1,00,000.00:  

Provided  that  if  the  Administrator  is  of  opinion  that  having  regard  to  the  difficulty  in  maintaining 
accounts  or  for  any other sufficient  cause  the taxable quantum  in  respect of any  class  of  dealers falling 
under clause (b) should be increased, the Administrator may, by notification in the Official Gazette, fix in 
respect of such class of dealers such taxable quantum, not exceeding rupees one lakh, as may be specified 
in the notification. 

Explanation.—For  the  purposes  of  computation  of  taxable  quantum  under sub-section  (7),  the 
turnover of all sales effected by a dealer shall be taken into account irrespective of whether such sales are 
taxable under this Act or not. 

4. Rate of tax.—(1) The tax payable by a dealer under this Act shall be levied— 

(a) in the case of taxable turnover in respect of the goods specified in the First Schedule, at the 

rate of twelve paise in the rupee; 

(b)  in  the  case  of  taxable  turnover in  respect of the  goods specified  in  the  Second  Schedule, at 
such  rate  not  exceeding four  paise in  rupee  as the  Central  Government  may,  from  time  to  time,  by 
notification in the Official Gazette, determine; 

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(c)  in  the  case  of  taxable  turnover  in  respect  of  any  food  or drink  served  for  consumption  in  a 
hotel  or  restaurant  or  part  thereof,  with  which  a  cabaret,  floor show  or  similar  entertainment  is 
provided therein, at the rate of forty paise in the rupee; 

(d) in the case of taxable turnover in respect of any other goods, at the rate of seven paise in the 

rupee: 

Provided that the  Administrator  may with the previous approval of the Central Government and  by 
notification in the Official Gazette, add to, or omit from, or otherwise amend, the First Schedule or the 
Second Schedule, either retrospectively or prospectively, and thereupon the First Schedule or, as the case 
may be, the Second Schedule, shall be deemed to be amended accordingly: 

Provided further that no such amendment shall be made retrospectively if it would have the effect of 

prejudicially affecting the interests of any dealer: 

Provided also that in respect of any goods or class of goods the Administrator is of the opinion that it 
is  expedient  in  the  interest  of  the  general  public  so  to  do,  he  may,  with  the  previous  approval  of  the 
Central Government and  by notification in the Official Gazette, direct that the tax in respect of taxable 
turnover of such goods or class of goods shall, subject to such conditions as may be specified, be levied at 
such  modified  rate  not  exceeding  the  rate  applicable  under  this  section,  as  may  be  specified  in  the 
notification. 

(2) For the purposes of this Act, “taxable turnover” means that part of a dealer’s turnover during the 

prescribed period in any year which remains after deducting therefrom,— 

(a) his turnover during that period on— 

(i)  sale  of  goods,  the  point  of  sale  at  which  such  goods shall  be  taxable  is  specified  by 
the Administrator under section 5 and in respect of which due tax is shown to the satisfaction of 
the Commissioner to have been paid; 

(ii) sale of goods declared tax-free under section 7; 

(iii) sale of goods not liable to tax under section 8; 

(iv)  sale  of  goods  which  are  proved  to  the  satisfaction  of  the  Commissioner  to  have  been 
purchased  within  a  period  of  twelve  months  prior  to  the  date  of  registration  of  the  dealer 
and subjected to tax under the Bengal Finance (Sales Tax) Act, 1941 (Bengal Act VI of 1941), as 
it was then in force, or under this Act; 

(v) sale to a registered dealer— 

(A)  of  goods  of  the  class  or  classes  specified  in  the  certificate  of  registration  of  such 
dealer, as being intended for use by him as raw materials in the manufacture in Delhi of any 
goods, other than goods specified in the Third Schedule, or newspapers,— 

(1) for sale by him inside Delhi; or 

(2)  for  sale  by him  in  the  course  of  inter-State  trade  or  commerce,  being  a  sale 
occasioning,  or  effected  by  transfer  of  documents  of  title  to  such  goods  during  the 
movement of such goods from Delhi; or 

(3) for sale by him in the course of export outside India being a sale occasioning the 
movement of such goods from Delhi, or a sale effected by transfer of documents of title 
to such goods effected during the movement of such goods from Delhi, to a place outside 
India and after the goods have crossed the customs frontiers of India; or 

(B)  of  goods  of  the  class  or  classes  specified  in  the  certificate  of  registration  of  such 
dealer  as  being  intended  for  resale  by him  in  Delhi,  or  for  sale  by him  in  the  course  of      
inter-State trade or commerce or in the course of export outside India in the manner specified 
in sub-item (2) or sub-item (3) of item (A), as the case may be; and 

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(C) of containers or other materials, used for the packing of goods, of the class or classes 
specified  in  the  certificate  of  registration  of  such  dealer, other  than  goods  specified  in  the 
Third Schedule, intended for sale or resale; 

(vi)  such other  sales  as  are  exempt  from  payment  of  tax  under  section 66 or  as  may  be 

prescribed: 

Provided  that  no  deduction  in respect  of  any  sale referred  to  in sub-clause  (iv) shall  be  allowed 
unless the goods, in respect of which deduction is claimed, are proved to have been sold by the dealer 
within a period of twelve months from the date of his registration and the claim for such deduction is 
included in the return required to be furnished by the dealer in respect of the said sale: 

Provided  further  that  no  deduction  in  respect  of  any  sale  referred  to  in  sub-clause  (v)  shall  be 
allowed unless a true declaration duly filled and signed by the registered dealer to whom the goods 
are  sold  and  containing  the  prescribed  particulars  in  the  prescribed  form  obtainable  from  the 
prescribed  authority  is  furnished  in  the  prescribed  manner  and  within  the  prescribed  time,  by  the 
dealer who sells the goods: 

Provided  also  that  where  any  goods  are  purchased  by  a  registered  dealer  for  any  of  the 
purposes mentioned  in  sub-clause  (v),  but  are  not  so  utilised  by him,  the  price  of  the  goods  so 
purchased shall be allowed to be deducted from the turnover of the selling dealer but shall be included 
in the taxable turnover of the purchasing dealer; and 

(b)  the  tax  collected  by  the  dealer  under  this  Act  as  such  and shown  separately  in 

cash memoranda or bills, as the case may be. 

5. Power of Administrator to prescribe points at which goods may be taxed.— Notwithstanding 
anything contained in this Act, the Administrator may, by notification in the Official Gazette and subject 
to such conditions, if any, as may be specified therein, specify the point of sale at which any goods or 
class of goods may be taxed, and on the issue of such notification, the points of sale in relation to any 
such goods or class of goods other than the point of sale so notified, shall be exempt from payment of tax 
under this Act: 

Provided that no such exemption shall be allowed unless a true declaration duly filled and signed by 
the  registered  dealer  by  whom  the  goods  are  sold  and  containing  the  prescribed  particulars  in  the 
prescribed form obtainable from the prescribed authority is furnished in the prescribed manner and within 
the prescribed time, by the dealer who purchases the goods: 

Provided  further  that  the  Administrator  may,  if  he  is  of  opinion  that  it  is  necessary  in  the  public 
interest  so  to  do,  by  notification  in  the  Official  Gazette,  exempt, subject  to  such  restrictions  and 
conditions as may be specified therein, any dealer or class of dealers from furnishing a declaration under 
the first proviso. 

6. Burden of proof.—The burden of proving that in respect of any sale effected by a dealer he is not 

liable to pay tax under this Act, shall lie on him. 

7. Tax-free goods.—(1) No tax shall be payable under this Act on the sale of goods specified in the 

Third Schedule subject to the conditions and exceptions, if any, set out therein. 

(2) The Administrator may, with the previous approval of the Central Government and by notification 
in  the  Official  Gazette,  add  to,  or  omit  from,  or  otherwise  amend,  the  Third  Schedule  either 
retrospectively  or  prospectively,  and  thereupon  the  Third  Schedule  shall  be  deemed  to  be  amended 
accordingly: 

Provided  that  no  such  amendment  shall  be  made  retrospectively  if  it  would  have  the  effect  of 

prejudicially affecting the interests of any dealer. 

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8.  Certain  sales  and  purchases  not  liable  to  tax.—Nothing  in  this  Act  or  the  rules  made 
thereunder shall be deemed to impose, or authorise the imposition of a tax on any sale or purchase of any 
goods when such sale or purchase takes place— 

(i) in the course of inter-State trade or commerce; or 

(ii) outside Delhi; or 

(iii) in the course of the import of the goods into, or export of the goods out of, the territory of 

India. 

Explanation.—Sections 3, 4,  and 5 of  the  Central  Sales  Tax  Act, 1956 (74 of 1956) shall  apply  for 
determining whether or not a particular sale or purchase takes place in the manner indicated in clause (i), 
clause (ii) or clause (iii) of this section.  

CHAPTER III 

SALES TAX AUTHORITIES AND APPELLATE TRIBUNAL 

9.  Sales  tax  authorities.—(1)  For  carrying  out  the  purposes  of  this  Act,  the  Administrator  shall 

appoint a person to be the Commissioner of Sales Tax. 

(2)  To  assist  the  Commissioner  in  the  execution  of his  functions  under  this  Act,  the  Administrator 
may appoint as many Additional Commissioners of Sales Tax, Sales Tax Officers and such other persons 
with such designations as the Administrator thinks necessary. 

(3) The Commissioner shall have jurisdiction over the whole of Delhi and the other persons appointed 

under sub-section (2) shall have jurisdiction over such areas as the Commissioner may specify. 

(4) The Commissioner and other persons appointed under sub-section (2) shall exercise such powers 

as may be conferred, and perform such duties as may be required, by or under this Act. 

10. Delegation of Commissioner’s powers.—Subject to such restrictions and conditions as may be 
prescribed, the Commissioner may, by order in writing, delegate any of his powers under this Act except 
those  under  sub-section  (3)  of  section 9 and sub-section  (1)  of  section 52 to  any  person  appointed 
under sub-section (2) of section 9: 

Provided  that  the  powers  of  the  Commissioner  under  clauses  (i)  to  (vi)  (both  inclusive)                        

of sub-section (3) of section 41 shall not be delegated to any person lower in rank than that of a Sales Tax 
Officer, and those under sub-section (1) of section 49 shall not be delegated to any person other than an 
Additional Commissioner of Sales Tax appointed under sub-section (2) of section 9. 

11. Power to transfer proceedings.—(1) The Commissioner may, by order in writing, transfer any 
proceedings  or  class  of  proceedings  under  any  provision  of  this  Act  from  any  person  appointed 
under  sub-section (2) of section 9 to any other person so appointed whether or not such other person has 
jurisdiction  in  respect  of  the  area  to  which  such  proceedings  or  class  of  proceedings  relate,  and  the 
Commissioner  may  likewise  transfer  any  such  proceedings  (including  a  proceeding  already  transferred 
under this section) from any such person to himself. 

(2) The person to whom any proceeding is transferred under sub-section (1) shall proceed to dispose 

it of as if it had been initiated by himself. 

(3) The  transfer  of a  proceeding shall  not render  necessary  the  reissue  of  any  notice  already  issued 
before such transfer and the person to whom the proceeding is transferred may, in his discretion, continue 
it from the stage at which it was left by the person from whom it was transferred. 

Explanation.—For the purposes of this section, “proceedings” in relation to any person whose name 
is specified in any order issued thereunder, means all proceedings under this Act in respect of any year 
which may be pending on the date of such order or which may have been completed on or before such 
date, and includes also such proceedings which may be commenced after the date of such order in respect 
of any year. 

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12. Disputes regarding territorial jurisdiction.—(1) No person shall be entitled to call in question 
the jurisdiction of any sales tax authority appointed under section 9, not being an appellate authority, after 
the expiry of ninety days from the date of receipt by that person of any notice under this Act issued by 
such sales tax authority. 

(2) Any objection as to the jurisdiction of any such sales tax authority may be raised within the period 
aforesaid  by  submitting  a memorandum  to  the  authority  concerned  who shall  refer  the  question  to  the 
Commissioner  and  the  Commissioner  shall  after  giving  the  person  raising  the  objection  a  reasonable 
opportunity of being heard, make an order determining the question and his decision in this behalf shall 
be final. 

13.  Appellate  Tribunal.—(1)  The Central  Government shall,  as  soon  as  may  be  after  the 
commencement  of  this  Act,  constitute  an  Appellate  Tribunal  consisting  of  one  or  more members,  as  it 
thinks fit, to exercise the powers and discharge the functions conferred on the Appellate Tribunal by or 
under this Act: 

Provided  that  where  the  Appellate Tribunal  consists of  one member,  that member shall  be  a  person 
who has held a civil judicial post for at least ten years or who has been a member of the Central Legal 
Service  (not below Grade III) for at least three years or who has been in practice as an advocate for at 
least  ten  years,  and  where  the  Appellate  Tribunal  consists  of  more  than  one member,  one 
such member shall be a person qualified as aforesaid. 

(2)  Where  the  number  of members  of  the  Appellate  Tribunal  is  more  than  one,  the Central 

Government shall appoint one of those members to be the Chairman of the Appellate Tribunal. 

(3) Subject to the  provisions  of sub-section  (1), the  qualifications  and other conditions  of service  of 
the member  or members  constituting  the  Appellate  Tribunal  and  the  period  for  which  such member 
or members shall hold office, shall be such as may be determined by the Central Government. 

 (4)  Any  vacancy  in  the membership  of  the  Appellate  Tribunal shall  be  filled  up  by  the Central 

Government as soon as practicable. 

(5)  Where  the  number  of members  of  the  Appellate  Tribunal  is  more  than  one  and  if  the members 
differ in opinion on any point, the point shall be decided according to the opinion of the majority, if there 
is  a majority,  but  if  the members  are  equally  divided,  the  decision  of  the  Chairman  of  the  Appellate 
Tribunal thereon shall be final. 

(6) Subject to the previous sanction of the Central Government, the Appellate Tribunal shall, for the 
purpose  of  regulating  its  procedure  and  disposal  of  its  business,  make  regulations  consistent  with  the 
provisions of this Act and the rules made thereunder. 

(7) The regulations made under sub-section (6) shall be published in the Official Gazette. 

(8)  The  Appellate  Tribunal shall,  for  the  purpose  of  discharging  its  functions,  have  all  the  powers 
which  are  vested  in  the  Commissioner  under  section 42 and  any  proceeding  before  the  Appellate 
Tribunal shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228, and for 
the  purposes  of  section 196 of  the  Indian  Penal  Code  (45 of 1860)  and  the  Appellate  Tribunal shall  be 
deemed to be a civil court for all the purposes of section 195 and Chapter XXVI of the Code of Criminal 
Procedure, 1973 (2 of 1974). 

CHAPTER IV 

REGISTRATION, AMENDMENT AND CANCELLATION 

14.  Registration.—(1)  No  dealer  shall,  while  being  liable  to  pay  tax  under  section  3,  carry  on 

business as a dealer unless he has been registered and possesses a certificate of registration. 

(2) Every dealer required by sub-section (1) to be registered shall make an application for registration 

within such time, in such manner and to such authority, as may be prescribed. 

10 

 
 
 
(3) If the said authority is satisfied that the application is in order, it shall, in accordance with such 
rules as may be prescribed, register the applicant within the prescribed period and grant him a certificate 
of registration in the prescribed form which shall specify the goods or class of goods for the purposes of 
sub-clause (v) of clause (a) of sub-section (2) of section 4: 

Provided that if the said authority is of opinion that the application is not in order, it shall, by an order 

passed within the said period and for reasons to be recorded in writing, reject the application: 

Provided  further  that  no  goods  or  class  of  goods  in  respect  of  which  the  1[point  of  sale]  has  been 
specified by the Administrator under section 5 shall be specified in a certificate of registration, and where 
a  notification  is  issued  under  that  section  subsequent  to  the  grant  of  any  certificate  of  registration  in 
respect of any goods or class of goods specified in a certificate, if the said certificate shall be deemed to 
have been amended to omit the references to such goods or class of goods. 

(4) For the removal of doubts, it is hereby declared that the goods or class of goods to be specified in 
a certificate of registration granted under sub-section (3) of this section or sub-section (2) of section 16 
shall not include goods referred to in sub-clause (i) or sub-clause (ii) of clause (a) of sub-section (2) of 
section 4. 

15.  Voluntary  registration.—(1)  Any  dealer,  other  than  a  dealer  who  deals  exclusively  in  one  or 
more classes of goods specified in the Third Schedule, whose turnover during a year exceeds twenty-five 
thousand  rupees  may,  notwithstanding  that  he  may  not  be  liable  to  pay  tax  under  section  3,  apply  for 
registration under this section. 

(2)  The  provisions  of  sub-sections  (2),  (3)  and  (4)  of  section  14  shall,  as  far  as  may  be,  apply  in 

relation to registration of dealers under this section. 

(3)  Every  dealer  who  has  been  registered  under  this  section  shall,  for  so  long  as  his  registration 

remains in force, be liable to pay tax under this Act. 

(4) The registration of a dealer under this section shall be in force for a period of not less than three 

complete years and shall remain in force thereafter unless cancelled under the provisions of this Act. 

16. Provisional registration.—(1) Any person who intends to establish a business in Delhi for the 
purpose  of  manufacturing  goods  of  a  value  exceeding  thirty  thousand  rupees  per  year,  may, 
notwithstanding that he is not required to be registered under section 14, apply for provisional registration 
in such manner and to such authority as may be prescribed. 

(2) If the said authority, after making such inquiry as it may consider necessary, is satisfied as to the 
bona  fide  intention  of  the  person  making  the  application,  it  may,  subject  to  such  restrictions  and 
conditions as it may impose, grant a provisional certificate of registration on such person furnishing such 
security as it may consider necessary and shall specify in such certificate the goods or class of goods for 
the purposes of sub-clause (v) of clause (a) of sub-section (2) of section 4. 

(3)  Every  person  who  has  been  granted  a  provisional  certificate  of  registration  under  this  section 

shall, for so long as such certificate is in force, be liable to pay tax under this Act. 

(4) A provisional certificate of registration granted under this section shall be in force for such period 

as may be specified therein. 

(5)  The  authority  prescribed  under  sub-section  (1)  may,  on  application  made  in  this  behalf  in  the 
prescribed manner and subject to such restrictions and conditions as it may impose, extend, from time to 
time, the period specified in the provisional certificate of registration. 

(6) The provisions of section 18 shall, so far as may be, apply in relation to security required to be 

furnished under sub-section (2) of this section. 

1. Subs. by Act 38 of 1978, s. 3 and the Second Schedule, for “points of sale” (w.e.f. 26-11-1978). 

11 

 
 
 
                                                           
(7) If a person, who has been granted a provisional certificate of registration under this section, fails 
without sufficient cause to establish a business within the period specified in such certificate or  fails to 
comply with any of the restrictions or conditions subject to which such certificate was granted, he shall be 
liable to pay a penalty equal to one and a half times the amount of tax which would have been payable 
had he not been so registered under this section. 

17. Special registration.—(1) No dealer shall, while being liable to pay tax under sub-section (5) of 

section 3, carry on business as a dealer unless he has obtained a special certificate of registration. 

(2)  Every  dealer  required  to  be  registered  under  sub-section  (1)  shall  make  an  application  for 

registration within such time, in such manner and to such authority, as may be prescribed. 

(3) If the said authority is satisfied that the application is in order, it shall, in accordance with  such 
rules  as  may  be  prescribed,  grant  a  special  certificate  of  registration  to  the  applicant  in  the  prescribed 
form: 

Provided that the said authority shall not specify in any such certificate the goods or class of goods 

for the purposes of sub-clause (v) of clause (a) of sub-section (2) of section 4. 

18. Security from certain class of dealers.—(1) The Commissioner may, if it appears to him to be 
necessary so to do for the proper realisation of the tax, composition money or other dues payable under 
this Act or for the proper custody and use of the forms referred to in the second proviso to clause (a) of 
sub-section (2) of section 4, or the first proviso to section 5, as the case may be, impose, for reasons to be 
recorded in writing as a condition of the grant of the certificate of registration under section 14, section 15 
or  section  17  to  a  dealer  or  of  the  continuance  in  effect  of  such  certificate  granted  to  any  dealer,  a 
requirement  that  the  dealer  shall  furnish  in  the  prescribed  manner  and  within  such  time  as  may  be 
specified in the order such security or, as the case may be, such additional security as may be so specified, 
for all or any of the aforesaid purposes. 

(2)  No  dealer  shall  be  required  to  furnish  any  security  or  additional  security  under  sub-section  (1) 
unless he has been given an opportunity of being heard and the amount of security or additional security 
that may be required to be furnished, shall,— 

(a) in the case of a dealer liable to pay tax under sub-section (2) of section 3 who has applied for 
the grant of a certificate of registration under section 14, be such amount as the Commissioner may, 
having regard to the nature and size of the business of such dealer, determine for the payment of the 
tax for which the dealer may be or become liable under this Act; 

(b) in a case where security is to be given for the proper custody and use of the forms referred to 
in sub-section (1), be the amount of tax determined by the Commissioner which is likely to be saved 
by a dealer by the issue of such forms; 

(c)  in  any  other  case,  not  exceed  the  tax  payable,  in  accordance  with  the  estimate  of  the 

Commissioner on the taxable turnover of the dealer, 

for the year in which such security or additional security is required to be furnished. 

(3) Where the security or additional security furnished by a dealer is in the form of a security bond 
and  the  surety  dies  or  becomes  insolvent,  the  dealer shall,  within  thirty  days  of  the  occurrence  of  such 
event,  inform  the  authority  granting  the  certificate  of  registration  and  shall,  within  ninety  days  of  such 
occurrence, execute a fresh surety bond. 

(4)  The  Commissioner  may  by  order,  for  good  and  sufficient  cause,  and  after  giving  the  dealer  an 

opportunity of being heard, forfeit the whole or any part of the security furnished by a dealer. 

(5)  Where,  by  reason  of  an  order  under  sub-section  (4),  the  security  furnished  by  any  dealer  is 
forfeited in whole or is rendered insufficient, he shall furnish a fresh security of the requisite amount or, 
as  the  case  may  be,  shall  make  up  the  deficiency  in  such  manner  and  within  such  period  as  may  be 
specified in the order. 

12 

 
19. Amendment of certificate of registration.—(1) The Commissioner may, after considering any 
information furnished under this Act or otherwise received and after making such inquiry as he may deem 
fit, amend from time to time any certificate of registration. 

(2) An amendment of the certificate of registration made under sub-section (1) shall take effect:— 

(a) in the case of a change in the name, ownership or place of business, or opening of a new place 
of  business,  from  the  date  of  contingency  which  necessitates  the  amendment  whether  or  not 
information in that behalf is furnished within the time prescribed under section 40; 

(b) in the case of any addition or modification in the description of any goods or class of goods in 
the  certificate  of  registration,  from  the  date  of  the  contingency  if  information  in  that  behalf  is 
furnished within the time prescribed under section 40 and from the date of receipt of request for such 
addition or modification by the Commissioner, in any other case; 

(c) in the case of deletion of any goods or class of goods, from the date of order of deletion: 

Provided  that  the  Commissioner shall,  before  amending  on his  own  motion  a  certificate  of 

registration, give the dealer affected by such amendment a reasonable opportunity of being heard: 

Provided further that where in consequence of a change in the ownership of a business the liability to 
pay tax of a dealer ceases, the amendment of the certificate of registration shall take effect from the date 
on which information in respect of such change is furnished under section 40. 

(3) Any amendment of a certificate of registration under this section shall be without prejudice to any 

liability for tax or penalty imposable, or for any prosecution for an offence under this Act. 

(4) For the removal of doubts, it is hereby declared that where a registered dealer— 

(a) effects a change in the name of his business; or 

(b) is a firm and there is a change in the constitution of the firm without dissolution thereof; or 

(c) is a trustee of a trust and there is a change in the trustees thereof; or 

(d) is a guardian of a ward and there is a change in the guardian; or 

(e) is a Hindu undivided family and the business of  such family is converted into a partnership 

business with all or any of the co-parceners as partners thereof, 

then, merely by reason of any of the circumstances aforesaid, it shall not be necessary for the dealer, or 
1[the firm which changed the constitution] or the new trustees, or the new guardian, or as the case may be, 
the partners of such partnership business, to apply for a fresh certificate of registration and on information 
being furnished in the manner required by section 40 the certificate of registration shall be amended. 

20. Cancellation of certificate of registration.—(1) Where— 

(a) any business in respect of which a certificate of registration has been granted to a dealer under 

this Act, is discontinued; or 

(b)  in  the  case  of  transfer  of  business  by  a  dealer,  the  transferee  already  holds  a  certificate  of 

registration under this Act; or 

(c) a dealer has ceased to be liable to pay tax under this Act, 

the Commissioner may cancel the certificate of registration of such dealer or the transferor, as the case 
may be, from such date as may be specified by him: 

Provided  that in  a case  referred to in clause  (a) or clause  (b), the  certificate  of registration shall  be 
deemed to be inoperative with effect from the date of  discontinuance or transfer of the business, as the 
case may be, and in a case referred to in clause (c), from the date on which the dealer’s liability to pay tax 
has ceased, notwithstanding the fact that the order of cancellation is passed or that the particulars of the 
dealer  regarding  cancellation  are  published,  as  required  by  section 65,  in  the  Official  Gazette,  after  the 
aforesaid date: 

1. Subs. by Act 38 of 1978, s. 3 and the Second Schedule, for “the firm who changed constitution” (w.e.f. 26-11-1978). 

13 

 
                                                           
Provided further that where a dealer has failed to furnish information regarding discontinuance of his 
business  as  required  by  section 40,  the  Commissioner shall  before  cancelling  the  certificate  from  any 
specified date, publish in the Official Gazette, a notice of his intention so to do for the information of the 
dealer and shall hear objections, if any, of the dealer before passing the order. 

(2)  A  dealer  registered  under  section  15  may,  subject  to  the  provisions  of  sub-section  (4)  of  that 
section,  apply  in  the  prescribed  manner  not  later  than  six  months  before  the  end  of  a  year  to  the 
Commissioner  for  cancellation  of  his  certificate  of  registration  and  the  Commissioner  shall,  unless  the 
dealer  is  liable  to  pay  tax  under  section  3,  cancel  the  certificate  of  registration  accordingly,  and  such 
cancellation shall take effect from the end of the year. 

(3)  Notwithstanding  anything  contained  in  sub-sections  (1)  and  (2),  the  Commissioner  may  at  any 
time for reasons to be recorded in writing and after giving the dealer an opportunity of being heard, cancel 
the certificate of registration held by such dealer from such date as the Commissioner may specify in this 
behalf— 

(a)  if  the  dealer  has  failed  to  pay  any  tax  (including  any  penalty)  due  from  him  under  any 

provisions of this Act; or 

(b)  if  the  dealer  holds  or  accepts  or  furnishes  or  causes  to  be  furnished  a  declaration  for  the 
purposes of sub-clause (v) of clause (a) of sub-section (2) of section 4 or section 5 which he knows or 
has reason to believe to be false; or 

(c) if the dealer who has been required to furnish the security under the provisions of section 18 

has failed to furnish such security; or 

(d) if the dealer contravenes or has contravened any of the provisions of this Act; or 

(e)  if  the  dealer  has  been  convicted  of  an  offence  under  this  Act  or  under  the  Bengal  Finance 

(Sales Tax) Act, 1941 (Bengal Act VI of 1941), as then in force in Delhi; or 

(f)  if  there  is  any  other  reason  which  in  the  opinion  of  the  Commissioner  warrants  such 

cancellation. 
(4) (a) If an order of cancellation passed under sub-section (3) is set aside as a result of an appeal or 
other proceeding under this Act, the certificate of registration of the dealer shall be restored and he shall 
be liable to pay tax as if his certificate had not been cancelled. 

(b)  If  any  dealer  whose  certificate  of  registration  has  been  restored  under  clause  (a)  satisfies  the 
Commissioner that tax has been paid by such dealer on sale of goods made to him during the period his 
certificate of registration was inoperative which, but for the cancellation of such certificate he would not 
have paid, then the amount of such tax shall be adjusted or refunded in such manner as may be prescribed. 

(5) Every dealer who applies for cancellation of his registration shall surrender with his application 
the  certificate  of  registration  granted to  him  and  every  dealer  whose registration  is  cancelled  otherwise 
than on the basis of his application shall surrender the certificate of registration within seven days of the 
date of communication to him of the order of cancellation. 

(6)  If  a  dealer  fails  to  surrender  his  certificate  of  registration  as  provided  in  sub-section  (5),  the 
Commissioner  may,  by  an  order  in  writing  and  after  giving  the  dealer  an  opportunity  of  being  heard, 
direct that the dealer shall pay, by way of penalty, a sum not exceeding twenty-five rupees for every day 
of default. 

(7) The cancellation of a certificate of registration shall not affect the liability of any person to pay tax 
due for any period prior to the date of such cancellation, whether such tax is assessed before the date of 
cancellation but remains unpaid or is assessed thereafter notwithstanding that he is not liable to pay tax 
under this Act. 

(8) Where by any order passed under this Act it is found that any person registered as a dealer ought 
not to have been so registered, then, notwithstanding anything contained in this Act, such person shall be 
liable to pay tax for the period commencing with the date of his registration and ending with the date of 
such order, as if he were a dealer. 

14 

 
 
 
CHAPTER V 

RETURNS, ASSESSMENT, RECOVERY AND REFUND OF TAX 

21. Periodical payment of tax and filing of returns.—(1) Tax payable under this Act shall be paid 

in the manner hereinafter provided at such intervals as may be prescribed. 

(2) Every registered dealer and every other dealer who may be required so to do by the Commissioner 
by notice served in the prescribed manner shall furnish such returns of turnover by such dates and to such 
authority as may be prescribed. 

(3)  Every  registered  dealer  required  to  furnish  returns  under sub-section  (2) shall  pay  into  a 
Government Treasury or the Reserve Bank of India or in such other manner as may be prescribed, the full 
amount  of  tax  due  from him  under  this  Act  according  to  such  return,  and shall  where  such  payment  is 
made  into  a  Government Treasury  or  the  Reserve Bank  of  India  furnish  along  with  the return  a receipt 
from such Treasury or Bank showing the payment of such amount. 

(4) If any registered dealer discovers any mistake or error in any return furnished by him, he may at 
any time, before the expiry of three months next following the last date prescribed for furnishing of the 
return,  furnish  a  revised  return,  and  if  the  revised  return shows  a higher  amount  of  tax  to  be  due  than 
was shown  in  the  original  return,  it shall  be  accompanied  by  a  receipt showing  payment  in  the  manner 
provided in sub-section (3) of the excess amount. 

(5) Every return under this section shall be signed and verified— 

(a) in the case of an individual, by the individual himself, and where the individual is absent from 
India by the individual concerned or by some person duly authorised by him in this behalf and where 
the  individual  is mentally  incapacitated  from  attending  to his  affairs,  by his  guardian  or  by 
any other person competent to act on his behalf; 

(b) in the case of a Hindu undivided family, by a Karta, and where the Karta is absent from India 

or is mentally incapacitated from attending to his affairs, by any other adult member of such family; 

(c) in the case of a company or local authority, by the principal officer thereof; 

(d) in the case of a firm, by any partner thereof, not being a minor; 

(e) in the case of any other association, by any member of the association or the principal officer 

thereof; and 

(f)  in  the  case  of  any other person,  by  that  person  or  by  some  person  competent  to  act  on his 

behalf. 

(6)  For  the  purposes  of sub-section  (5)  of  this  section  and  section 59 the  expression  “principal 
officer” shall  have  the  meaning  assigned  to  it  under  clause  (35)  of  section 2 of  the  Income-Tax 
Act, 1961 (43 of 1961). 

22. Collection of tax only by registered dealers.—(1) No person who is not a registered dealer shall 
collect in respect of any sale of goods by him in Delhi any amount by way of tax under this Act, and no 
registered dealer shall make any such collection except in accordance with this Act and the rules made 
thereunder. 

(2)  Notwithstanding  anything  contained  in sub-section  (1),  a  dealer  who  has  been  permitted  by  the 
Commissioner to make a lump sum payment under section 29 shall not collect any sum by way of tax on 
the sale of goods if made during the period of which such lump sum payment relates. 

23. Assessment.—(1) The amount of tax due from a registered dealer shall be assessed separately for 

each year during which he is liable to pay the tax: 

Provided  that  when  such  dealer  fails  to  furnish  a  return  relating  to  any  period  of  a  year  by  the 
prescribed date, the Commissioner may, if he thinks fit, assess the tax due from such dealer separately for 
that period or any other period of such year: 

15 

 
Provided further that the Commissioner may, subject to such conditions as may be prescribed and for 

reasons to be recorded in writing, assess the tax due from any dealer for a part of a year. 

(2) If the Commissioner is satisfied that the returns furnished in respect of any period are correct and 

complete, he shall assess the amount of tax due from the dealer on the basis of such returns. 

(3)  (a)  If  the  Commissioner  is  not  satisfied  that  the  returns  furnished  in  respect  of  any  period  are 
correct and complete and he thinks it necessary to require the presence of the dealer or the production of 
further evidence, he shall serve on such dealer in the prescribed manner a notice requiring him on a date 
and at a place specified therein either to attend and produce or cause to be produced all evidence on which 
such dealer relies in support of his returns, or to produce such evidence as is specified in the notice. 

(b) On the date specified in the notice, or as soon as may be thereafter, the Commissioner shall, after 

considering all the evidence which may be produced, assess the amount of tax due from the dealer. 

(4)  If  a  dealer  fails  to  comply  with  the  terms  of  any  notice  issued  under sub-section  (3),  the 

Commissioner shall assess to the best of his judgment the amount of tax, if any, due from him. 

(5)  If  a  dealer  fails  to  furnish  returns  in  respect  of  any  period  by  the  prescribed  date,  the 
Commissioner shall,  after  giving  the  dealer  a  reasonable  opportunity  of  being  heard,  assess  to  the  best 
of his judgment the amount of tax, if any, due from him. 

(6) If, upon information which has come into his possession, the Commissioner is satisfied that any 
dealer  who  has  been liable  to  pay  tax under this  Act in  respect  of  any  period,  has  failed  to  get himself 
registered  under  section 14 or  section 17,  as  the  case  may  be,  the  Commissioner shall  proceed  in  such 
manner as may be prescribed to assess to the best of his judgment the amount of tax due from the dealer 
in respect of such period and all subsequent periods and in making such assessment shall give the dealer a 
reasonable opportunity of being heard, and the Commissioner may, if he is satisfied that the default was 
made  without  reasonable  cause,  direct  that  the  dealer shall  pay,  by  way  of  penalty,  in  addition  to  the 
amount of the tax so assessed, a sum not exceeding twice that amount. 

(7)  No  assessment  under  the  provisions  of sub-sections  (1)  to  (5) shall  be  made  after  the  expiry  of 
four years, and no assessment under the provisions of sub-section (6) shall be made after the expiry of six 
years from the end of the year in respect of which or part of which the tax is assessable: 

Provided that where such assessment is made in consequence of or to give effect to, any order of an 
appellate  or  revisional  authority  or  of  a  court,  the  period  of  four  years  or  six  years,  as  the  case  may 
be, shall  be  reckoned  from  the  date  of  such order  and  further  that  the  provisions  of sub-section  (1)  of 
section 24  regarding  time  limit  for  service  of  notice shall  not  apply  for  assessment  made  under  this 
proviso. 

(8)  Any  assessment  made  under  this  section shall  be  without  prejudice  to  any  prosecution  for  an 

offence under this Act. 

24. Turnover escaping assessment.—(1) Where after a dealer has been assessed under section 23 for 
any year or part thereof, the Commissioner has reason to believe that the whole or any part of the turnover 
of a dealer in respect of any period has escaped assessment to tax or has been under-assessed or has been 
assessed at a rate lower than the rate at which it is assessable, or any deduction has been wrongly made 
therefrom, the Commissioner may— 

(a)  within  six  years  from  the  date  of  final order  of  assessment,  in  a  case  where  the  dealer  has 

concealed, omitted or failed to disclose fully the particulars of such turnover; and 

(b) within four years from the date of final order of assessment, in any other case, 

serve a notice on the dealer and after giving the dealer an opportunity of being heard and making such 
inquiry as he considers necessary, proceed to determine to the best of his judgment, the amount of tax due 
from the dealer in respect of such turnover, and the provisions of this Act shall, so far as may be, apply 
accordingly. 

16 

 
Explanation.—For the purposes of this section, production before the Commissioner of account books 
or other evidence  from  which  material  evidence  could  with  due  diligence  have  been  discovered  by  the 
Commissioner will not necessarily amount to disclosure within the meaning of this section. 

(2)  No order  of  assessment,  reassessment  or  re-computation shall  be  made  under sub-section  (1), 

after— 

(a)  the  expiry  of  four  years  or,  as  the  case  may  be,  six  years  as  specified  in sub-section  (7)  of     

section 23; or 

(b) the expiry of one year from the date of service of notice under sub-section (1), 

whichever is later. 

25. Payment and recovery of tax.—(1) The amount of tax— 

(a) due where returns have been furnished without the receipt showing full payment thereof; and 

(b)  assessed,  reassessed  or  re-computed  for  any  period  under  section 23 or  section 24,  less  the 

amount if any, already paid by the dealer in respect of the said period, 

shall  together  with  any  penalty  that  may  be  directed  to  be  paid  under  any  of  the  provisions  of  this 
section, sub-section  (6)  of  section 23,  section 55,  section 56 or  section 57 be  paid  by  the  dealer  or  the 
person liable therefor into a Government Treasury or the Reserve Bank of India or in such other manner 
as  may  be  prescribed  within  thirty  days  from  the  date  of  service  of  notice  of  demand  issued  by  the 
Commissioner for this purpose: 

Provided that where the Commissioner has reason to believe that it will be detrimental to revenue if 
the full period of thirty days aforesaid is allowed, he may direct that the sum specified in the notice of 
demand shall be paid within such period being a period less than the period of thirty days aforesaid, as 
may be specified by him in that notice. 

(2) On an application made before the expiry of the due date under sub-section (1), the Commissioner 
may, in respect of any particular dealer or person and for reasons to be recorded in writing, extend the 
time  for  payment  or  allow  payment  by  instalments  or  grant  stay, subject  to  such  conditions  as  he  may 
think fit to impose in the circumstances of the case. 

(3) If the amount of tax and penalty, if any, is not paid within the time specified in sub-section (1) or 
extended  under sub-section  (2),  as  the  case  may  be,  the  dealer  or  the  person  liable  therefor shall  be 
deemed to be in default in respect of that amount. 

(4)  In  a  case  where  payment  by  instalments  is  allowed  under sub-section  (2)  and  the  dealer  or  the 
person liable for such payment commits default in paying any one of the instalments within the time fixed 
under that sub-section, the dealer or the person aforesaid shall be deemed to be in default in respect of the 
whole  of  the  amount  then  outstanding  and  the other  instalment  or  instalments shall  be  deemed  to  have 
been due on the same date as the instalment actually in default. 

(5) When a dealer or a person is in default or is deemed to be in default in making payment of tax and 
penalty, if any, he shall, in addition to the amount of arrears payable under the foregoing sub-sections, be 
liable to pay, by way of penalty, an amount which in the case of a continuing default may be increased, 
from time to time, so however, that total amount of penalty does not exceed the amount in arrears: 

Provided  that  before  levying  any  such  penalty,  the  dealer  or  the  person  aforesaid shall  be  given  a 

reasonable opportunity of being heard. 

(6)  Where  as  a  result  of  any  final order  the  amount  of  tax  and  penalty,  if  any,  with  respect  to  the 
default, in the payment of which the penalty was levied, has been wholly reduced, the penalty levied shall 
be cancelled and the amount of penalty paid shall be refunded. 

17 

 
 
 
(7)  Any  amount  of  tax  or  penalty  in  respect  of  which  a  dealer  or  person  is  in  default,  or  any 
composition money due under section 29 or section 54 which remains unpaid, shall be recoverable as an 
arrear of land revenue: 

Provided  that where security, other than in the form of surety bond, has been furnished by a dealer 
under sub-section (2) of section 16 or section 18, the Commissioner may, for good and sufficient reasons 
in writing, realise any amount of tax or penalty or composition money remaining unpaid as aforesaid or 
part thereof by ordering forfeiture of the whole or any part of the security. 

26. Continuation of certain recovery proceedings.—Where any notice of demand in respect of any 
tax  or  penalty  or  any other amount  payable  under  this  Act (hereafter  in  this  section  referred  to  as 
“government dues”) is served upon any dealer, and any appeal, revision application or other proceeding is 
filed or taken in respect of such government dues, then,— 

(a) where such government dues are enhanced in such appeal, revision or other proceeding, the 
Commissioner shall serve upon the dealer another notice of demand only in respect of the amount by 
which  such  government  dues  are  enhanced  and  any  recovery  proceedings  in  relation  to  such 
government dues as are covered by the notice of demand served upon him before the disposal of such 
appeal, revision application or proceeding may, without the service of any fresh notice of demand, be 
continued from the stage at which such proceedings stood immediately before such disposal; 

(b) where such government dues are reduced in such appeal, revision or proceeding,— 

(i) it shall not be necessary for the Commissioner to serve upon the dealer a fresh notice of 

demand; 

(ii)  the  Commissioner shall  give  intimation  of  such reduction  to him  and  to  the appropriate 

authority with whom recovery proceedings are pending; 

(iii) any recovery proceedings initiated on the basis of the notice of demand served upon him 
before  the  disposal  of  such  appeal,  revision  application  or  proceeding  may  be  continued  in 
relation to the amount so reduced from the stage at which such proceedings stood immediately 
before such disposal. 

27. Interest.—(1) If any dealer fails to pay the tax due as required by sub-section (3) of section 21, 
he shall, in addition to the tax (including any penalty) due, be liable to pay simple interest on the amount 
so due at one per cent. per month from the date immediately following the last date for submission of the 
return under sub-section (2) of the said section for a period of one month, and at one and a half per cent. 
per  month  thereafter  for  so  long  as  he  continues  to  make  default  in  such  payment  or  till  the  date  of 
completion of assessment under section 23, whichever is earlier. 

(2) When a dealer or a person is in default or is deemed to be in default in making the payment of tax, 
he shall, in addition to the amounts payable under section 23 or section 24, be liable to pay simple interest 
on such amount at one per cent. per month from the date of such default for a period of one month, and at 
one and a half per cent. per month thereafter for so long as he continues to make default in the payment of 
the said amount. 

(3) Where as a result of any final order the amount of tax (including any penalty) due or in default is 
wholly  reduced,  the  amount  of  interest,  if  any,  paid shall  be  refunded,  or  if  such  amount  is  varied,  the 
interest due shall be calculated accordingly: 

Provided  that  where  any  amount  of  tax  payable  is  enhanced  by  any  such order,  interest shall  be 
payable on the amount by which the tax is enhanced after the expiry of a period of three months from the 
date of the order: 

Provided further that where the realisation of any amount remains stayed by the order of any court or 
authority  and  such order  is subsequently  vacated,  interest shall  be  payable  also  for  any  period  during 
which such order remained in operation. 

(4) The interest payable under this section shall be deemed to be tax due under this Act. 

18 

 
28. Special model of recovery.—(1) Notwithstanding anything contained in any law or contract to 
the  contrary,  the  Commissioner  may,  at  any  time  or  from  time  to  time,  by  notice  in  writing,  a  copy  of 
which shall be forwarded to the dealer at his last known address, require— 

(a)  any  person  from  whom  any  amount  of  money  is  due,  or  may  become  due,  to  a  dealer  on 

whom notice has been served under sub-section (1) of section 25, or 

(b) any person who holds or may, subsequently hold money for or on account of such dealer, 

to pay to the Commissioner, either forthwith upon the money becoming due or being held or within the 
time specified in the first mentioned notice (but not before the money becomes due or is held as aforesaid) 
so much of the money as is sufficient to pay the amount due by the dealer in respect of the arrears of tax 
and penalty under this Act, or the whole of the money when it is equal to or less than that amount. 

Explanation.—For  the  purposes  of  this sub-section,  the  amount  of  money  due  to  a  dealer  from,  or 
money held for or on account of a dealer by, any person, shall be calculated by the Commissioner after 
deducting therefrom such claims (if any) lawfully subsisting, as may have fallen due for payment by such 
dealer to such person. 

(2)  The  Commissioner  may  amend  or  revoke  any  such  notice  or  extend  the  time  for  making  any 

payment on pursuance of the notice. 

(3) Any person making any payment in compliance with a notice under this section shall be deemed 
to  have  made  the  payment  under  the  authority  of  the  dealer,  and  the  receipt  thereof  by  the 
Commissioner shall constitute a good and sufficient discharge of the liability of such person to the extent 
of the amount specified in the receipt. 

(4)  Any  person  discharging  any  liability  to  the  dealer  after  receipt  of  the  notice  referred  to  in  this 
section, shall be personally liable to the Commissioner to the extent of the liability discharged or to the 
extent of the liability of the dealer for tax and penalty, whichever is less. 

(5)  Where  a  person  to  whom  a  notice  under  this  section  is  sent,  proves  to  the  satisfaction  of  the 
Commissioner that the sum demanded or any part thereof is not due to the dealer or that he does not hold 
any  money  for  or  on  account  of  the  dealer,  then,  nothing  contained  in  this  section shall  be  deemed  to 
require such person to pay any such sum or part thereof, as the case may be, to the Commissioner. 

(6) Any amount of money which the aforesaid person is required to pay to the Commissioner, or for 
which  he  is  personally  liable  to  the  Commissioner  under  this  section shall,  if  it  remains  unpaid,  be 
recoverable as an arrear of land revenue. 

(7)  The  Commissioner  may  apply  to  the  court  in  whose  custody  there  is  money  belonging  to  the 
dealer for payment to him of the entire amount of such money or if it is more than the tax and penalty, if 
any, due, an amount sufficient to discharge such tax and the penalty. 

29. Lump sum payment of tax.—The Commissioner may, in such circumstances and subject to such 
conditions as  may  be  prescribed,  permit  any  dealer to  pay  in lieu  of  the  amount  of  tax  payable  by him 
under the provision of this Act, a lump sum determined in the prescribed manner, by way of composition. 

30.  Refund.—(1)  If  any  person  satisfies  the  Commissioner  that  the  amount  of  tax  paid  by him  or 
on his behalf for any year exceeds the amount payable by him under this Act for that year, he shall, on 
making a claim in the prescribed form and verified in the prescribed manner, be entitled to refund of the 
excess either by cash payment or at his option by deduction of such excess from the amount of tax and 
penalty (if any) due in respect of any other period: 

Provided that the Commissioner shall first apply such excess towards the recovery of any amount in 

respect of which a notice under section 25 has been issued and shall then refund the balance, if any. 

Explanation.—When no assessment is made, the due tax paid under section 21 by the dealer shall be 

deemed to be the tax payable under this Act. 

19 

 
 
 
(2) Where on account of death, incapacity, insolvency, liquidation or other cause a person is unable to 
claim or receive any refund due to him, his legal representative or the trustee or guardian or receiver, as 
the  case  may  be, shall  be  entitled  to  claim  or  receive  such  refund  for  the  benefit  of  such  person  or his 
estate. 

(3)  No  claim  for  refund under sub-section  (1) shall  be  allowed  unless it is  made  within  a period  of 
twelve  months  from  the  date  of  the order  giving  rise  to  a  claim  for  such  refund,  and  the 
Commissioner shall, except as otherwise provided in this Act, refund any amount which becomes due to a 
dealer in the prescribed manner: 

Provided that the Commissioner may allow a claim for refund to be made after the expiry of the said 
period but not later than twelve months from such expiry, if he is satisfied that there was sufficient cause 
for not making such claim within that period. 

(4)  Where  an  amount  required  to  be  refunded  by  the  Commissioner  to  any  person  as  a  result  of 
any order  passed  in  appeal  or other proceedings  under  this  Act  is  not  so  refunded  to him  within  ninety 
days  from  the  date  of his  claim  under sub-section  (3),  such  person shall  be  entitled  to  be  paid  simple 
interest on such amount at one per cent. per month from the date immediately following the expiry of the 
period of ninety days for a period of one month and at one and a half per cent. per month, thereafter for so 
long as the refund is not made. 

Explanation.—If  the  delay  in  making  the  refund  during  any  of  the  periods  referred  to  in            

this sub-section is attributable to the person making the claim, whether wholly or in part, the period of the 
delay attributable to him shall be excluded from the period for which interest is payable. 

(5)  Where  any  question  arises  as  to  the  period  to  be  excluded  for  the  purposes  of  calculation  of 
interest  under sub-section  (4),  such  question shall  be  determined  by  the  Commissioner  whose  decision 
thereon shall be final. 

(6) Where an order giving rise to a refund is the subject matter of an appeal or further proceeding or 
where any other proceeding under this Act is pending and the Commissioner is of opinion that the grant 
of the refund is likely to adversely affect the revenue, the Commissioner may withhold the refund till such 
time as the Commissioner may determine. 

(7)  In  any  claim  for  refund,  it shall  not  be  open  to  the  dealer  to  question  the  correctness  of  any 
assessment or other matter decided which has become final and conclusive or ask for a review of the same 
and the dealer shall not be entitled to any relief on such claim except refund of tax wrongly paid or paid in 
excess. 

(8)  Any  tax  levied  and  collected  under  this  Act  in  respect  of  sale  in  Delhi  of  any  declared  goods 
which  are subsequently  sold  in  the  course  of  inter-State  trade  or  commerce, shall  be  reimbursed  to  the 
person making the sale on the course of inter-State trade or commerce, in such manner and subject to such 
conditions as may be prescribed. 

Explanation.—For  the  purposes  of sub-section  (8),  “declared  goods” means  goods  declared  by 
section 14 of the Central Sales Tax Act, 1956 (74 of 1956) to be of special importance in inter-State trade 
or commerce. 

31.  Set-off.—(1)  Where  the  Commissioner  is  satisfied  that  delay  beyond  the  prescribed  period  has 
occurred in the grant of a certificate of registration to a dealer and that such delay was not wholly due to 
any  fault,  omission  or  negligence  on  the  part  of  the  dealer,  the  amount  of  tax,  if  any,  paid  on  sales  of 
goods  made  to  such  dealer  which  would  not  have  been  payable  but  for  the  delay  in  the  grant  of  a 
certificate of registration as aforesaid, shall be adjusted against any amount payable by the dealer under 
this Act: 

Provided that— 

(a) in case the amount of tax so paid by the dealer exceeds his liability to pay any amount under 
this Act, the adjustment shall be made to the extent of such liability and the balance shall be refunded 
to the dealer; and 

20 

 
(b)  in  case  there  is  no  liability  to  pay  any  amount  under  this  Act,  the  entire  amount  of  tax 

paid shall be refunded to the dealer: 

Provided further that the dealer shall not be entitled to any such adjustment or refund in respect of the 

goods which are not specified in the certificate of registration granted to him. 

(2) No application for adjustment or refund of tax under this section shall be entertained unless it is 

made within three months from the date on which a certificate of registration is granted to the dealer. 

CHAPTER VI 

LIABILITY IN SPECIAL CASES 

32. Liability in case of transfer of business.—(1) Where a dealer, liable to pay tax under this Act, 
transfers his business in whole or in part, by sale, gift, lease, leave or licence, hire or in any other manner 
whatsoever, the dealer and the person to whom the business is so transferred shall jointly and severally be 
liable to pay the tax (including any penalty) due from the dealer up to the time of such transfer, whether 
such  tax  (including  any  penalty)  has  been  assessed  before  such transfer,  but  has  remained  unpaid  or  is 
assessed thereafter. 

(2)  Where  the  transferee  or  the  lessee  of  a  business  referred  to  in sub-section  (1)  carries  on  such 
business either in his own name or in some other name, he shall be liable to pay tax on the sale of goods 
effected  by him  with  effect  from  the  date  of  such  transfer  and shall,  if  he  is  an  existing  dealer,  apply 
within the prescribed time for amendment of his certificate of registration. 

33. Liability in case of company in liquidation.—(1) Every person— 

(a) who is a liquidator of any company which is being wound up whether under the orders of a 

court or otherwise; or 

(b) who has been appointed the receiver of any assets of a company (hereinafter referred to as the 

“liquidator”), 

shall, within thirty days after he has become such liquidator, give notice of his appointment as such to the 
Commissioner. 

(2) The  Commissioner shall,  after  making  such  inquiries  or  calling  for  such  information  as  he  may 
deem  fit,  notify  the  liquidator  within  three  months  from  the  date  on  which  he  received  notice  of  the 
appointment of the liquidator, the amount which, in the opinion of the Commissioner, would be sufficient 
to provide for any tax (including any penalty) which is then, or is likely thereafter to become, payable by 
the company. 

(3) The liquidator shall not part with any of the assets of the company or the properties in his hand 
until  he  has  been  notified  by  the  Commissioner  under sub-section  (2)  and  on  being  so  notified,  the 
liquidator shall set aside an amount equal to the amount notified and, until he so sets aside such amount, 
he shall not part with any of the assets of the company or the properties in his hand: 

Provided that nothing contained in this sub-section shall debar the liquidator from parting with such 
assets or properties in compliance with any order of a court or for the purpose of the payment of the tax 
and  penalty,  if  any,  payable  by  the  company  under  this  Act  or  for  making  any  payment  to  secured 
creditors whose debts are entitled under law to priority of payment over debts due to Government on the 
date of liquidation or for meeting such costs and expenses of the winding up of the company as are in the 
opinion of the Commissioner reasonable. 

(4)  If  the  liquidator  fails  to  give  notice  in  accordance  with sub-section  (1)  or  fails  to  set  aside  the 
amount  as  required  by  sub-section  (3)  or  parts  with  any  assets  of  the  company  or  the  properties  in his 
hand in contravention of the provisions of that sub-section, he shall be personally liable for the payment 
of the tax and penalty, if any, which the company would be liable to pay under this Act: 

Provided  that  if  the  amount  of  any  tax  and  penalty,  if  any,  payable  by  the  company  is  notified 
under sub-section (2), the personal liability of the liquidator under this sub-section shall be to the extent of 
such amount. 

21 

 
(5) Where there are more liquidators than one, the obligations and liabilities attached to the liquidator 

under this section shall attach to all the liquidators jointly and severally. 

(6) When any private company is wound up and any tax and penalty, if any, assessed under this Act 
on  the  company  for  any  period,  whether  before  or  in  the  course  of  or  after  its  liquidation,  cannot  be 
recovered, then every person who was director of the private company at any time during the period for 
which the tax is due, shall be jointly and severally liable for the payment of such tax and penalty, if any, 
unless  he  proves  to  the  satisfaction  of  the  Commissioner  that  non-recovery  cannot  be  attributed  to  any 
gross neglect, misfeasance or breach of duty on his part in relation to the affairs of the company. 

(7) The provisions of this section shall have effect notwithstanding anything to the contrary contained 

in any other law for the time being in force. 

(8)  For  the  purposes  of  this  section,  the  expressions  “company”  and  “private  company” shall  have 
the meanings respectively assigned to them under clauses (i) and (iii) of sub-section (1) of section 3 of the 
Companies Act, 1956 (1 of 1956). 

34. Liability of partners of firm to pay tax.—Notwithstanding any contract to the contrary, where 
any firm is liable to pay any tax (including any penalty) under this Act, the firm and each of the partners 
of the firm shall be jointly and severally liable for such payment: 

Provided that where any such partner retires from the firm, he shall intimate the date of his retirement 
to the Commissioner by a notice in that behalf in writing and he shall be liable to pay tax (including any 
penalty) remaining unpaid at the time of his retirement and any tax (including any penalty) due up to the 
date of his retirement though unassessed on that date: 

Provided further that if no such intimation is given within fifteen days from the date of retirement, the 
liability  of  the  partner  under  the  first  proviso shall  continue  until  the  date  on  which  such  intimation  is 
received by the Commissioner. 

35.  Liability  of  guardians,  trustees,  etc.—Where  the  business  in  respect  of  which  tax  is  payable 
under  this  Act  is  carried  on  by,  or  is  in  the  charge  of  any  guardian,  trustee  or  agent  of  a  minor 
or other incapacitated person on his behalf and for the benefit of such minor or other incapacitated person, 
the tax (including any penalty) shall be levied upon and recoverable from such guardian, trustee or agent, 
as the case may be, in like manner and to the same extent as it would be assessed upon and recoverable 
from  any  such  minor  or other incapacitated  person,  if  he  were  of  full  age  and  of  sound  mind  and  if  he 
were  conducting  the  business  himself,  and  all  the  provisions  of  this  Act shall,  so  far  as  may  be,  apply 
accordingly. 

36.  Liability  of  Court  of  Wards,  etc.—Where  the  estate  or  any  portion  of  the  estate  of  a  dealer 
owning a business in respect of which tax is payable under this Act is under the control of the Court of 
Wards, the Administrator-General, the Official Trustee or any receiver or manager (including any person, 
whatever  be his  designation,  who  in  fact  manages  the  business)  appointed  by  or  under  any order  of  a 
court, the tax (including any penalty) shall be levied upon and be recoverable from such Court of Wards, 
Administrator-General, Official Trustee, receiver or manager in like manner and to the same extent as it 
would be assessable upon and be recoverable from the dealer if he were conducting the business himself; 
and all the provisions of this Act shall, so far as may be, apply accordingly. 

37. Liability in other cases.—(1) Where a dealer is a firm or an association of persons or a Hindu 

undivided family, and such firm, association or family has discontinued business— 

(a)  the  tax  payable  under  this  Act,  by  such  firm,  association  or  family  up  to  the  date  of  such 

discontinuance may be assessed as if no such discontinuance had taken place; and 

(b) every person who was at the time of such discontinuance a partner of such firm, or a member 
of  such  association  or  family, shall,  notwithstanding  such  discontinuance,  be  liable  jointly  and 
severally for the payment of tax assessed and penalty imposed and payable by such firm, association 
or  family,  whether  such  tax  (including  any  penalty)  has  been  assessed  prior  to  or  after  such 
discontinuance, and subject as aforesaid, the provisions of this Act shall, so far as may be, apply as if 
every such person or partner or member were himself a dealer: 

22 

 
Provided  that  where  the  partner  of  a  firm  liable  to  pay  such  tax  (including  any  penalty)  dies,  the 

provisions of sub-section (4) shall, so far as may be, apply. 

(2) Where a change has occurred in the constitution of a firm or association, the partners or members 
of  the  firm  or  association  as  it  existed  before  and  as  it  exists  after  its  re-constitution, shall,  without 
prejudice  to  the  provisions  of  section 34,  jointly  and  severally  be  liable  to  pay  any  tax  (including  any 
penalty) due from such firm or association for any period before its re-constitution. 

(3) The provisions of sub-section (1) shall, so far as may be, apply where the dealer, being a firm or 
association  of  persons,  is  dissolved  or  where  the  dealer,  being  a Hindu  undivided  family,  has  effected 
partition  with  respect  to  the  business  carried  on  by  it  and  accordingly  references  in  that sub-section  to 
discontinuance shall be construed as references to dissolution or, as the case may, to partition. 

(4) Where a dealer liable to pay tax under this Act dies, than— 

(a) if the business carried on by the dealer is continued after his death by his legal representative 
or any other person, such legal representative or other person, shall be liable to pay the tax (including 
any penalty) due from the dealer under this Act, whether such tax (including any penalty) has been 
assessed before his death but has remained unpaid, or is assessed after his death; 

(b)  if  the  business  carried  on  by  the  dealer  is  discontinued  after his  death, his  legal 
representative shall be liable to pay out of the estate of the deceased, to the extent the estate is capable 
of meeting  the  charge,  the  tax  (including  any  penalty)  due  from  the  dealer  under  this  Act,  whether 
such  tax (including  any  penalty)  has  been  assessed  before his  death  but  has  remained  unpaid,  or is 
assessed after his death, 

and the provisions of this Act shall, so far as may be, apply to such legal representative or other person as 
if he were the dealer himself. 

Explanation.—For  the  purposes  of  this sub-section  and  section 40, “legal  representative”  has 

the meaning assigned to it in clause (11) of section 2 of the Code of Civil Procedure, 1908 (5 of 1908). 

LIABILITY TO PRODUCE ACCOUNTS AND SUPPLY OF INFORMATION 

CHAPTER VII 

38. Accounts.—(1) Every dealer liable to pay tax under this Act, and every other dealer on whom a 
notice  has  been  served  to  furnish  returns  under sub-section  (2)  of  section 21  shall  keep  at his  place  of 
business a true account of the value of goods bought and sold by him, and if the Commissioner considers 
that  such  account  is  not  sufficiently  clear  and  intelligible  to  enable him  to  make  a  proper  check  of  the 
returns  referred  to  in  that  sub-section,  he  may  require  such  dealer  by  notice  in  writing  to  keep  such 
accounts (including records of purchases and sales) and as may be specified therein. 

(2)  The  Commissioner  may,  by  notification  in  the  Official  Gazette,  direct  any  class  of  registered 
dealers generally to keep such accounts (including records of purchases and sales) as may be specified in 
the notification subject to such conditions and restrictions as may be prescribed. 

39. Memoranda of sales.—If a registered dealer— 

(a) sells goods to another registered dealer, or 

(b) makes sales in the course of inter-State trade or commerce, or 

(c) sells any goods exceeding ten rupees in value in any one transaction to any other person, 

he shall  issue  to  the  purchaser  a  bill  or  cash memorandum  serially  numbered,  signed  and  dated  by him 
or his servant, manager or agent and showing therein his name and address and such other particulars as 
may be prescribed and he shall keep a duplicate or copy of such bill or cash memorandum duly signed 
and  dated  and  preserve  it  for  a  period  of  not  less  than  five  years  from  the  end  of  the  year  unless  any 
proceedings in respect of that year are pending in which case they shall be preserved till the final decision 
in those proceedings: 

23 

 
 
 
Provided  that  if  in  respect  of  any  goods  or  class  of  goods  or  any  dealers  or  class  of  dealers, 
the Administrator is of the opinion that it is not practicable to issue any bills or cash memoranda for sale 
of goods exceeding ten rupees in value in any one transaction to any other person, he may, by notification 
in the Official Gazette,— 

(i) specify such amount exceeding ten rupees in value as the amount for the issue of such bills or 

cash memoranda; 

(ii) exempt such goods or class of goods or dealers or class of dealers from the operation of this 

section. 

40.  Information  to  be  furnished  regarding  change  of  business.—If  any  dealer  to  whom  the 

provisions of sub-section (2) of section 21 apply— 

(a) sells or otherwise disposes of his business or any part of his business or any place of business, 

or effects or comes to know of any other change in the ownership of the business; or 

(b) discontinues his business or changes his place of business or warehouse, or opens a new place 

of business; or 

(c)  changes  the  name  or  nature  of his  business,  or  effects  any  change  in  the  goods  or  class  of 
goods  in  which  he  carries  on his  business  and  which  is  or  are  specified  in his  certificate  of 
registration; or 

(d) enters into partnership or other association in regard to his business, 

he shall, within the prescribed time, inform the prescribed authority accordingly, and if any such dealer 
dies, his legal representative shall in like manner inform the said authority. 

41.  Production  and  inspection  of  accounts  and  documents  and  search  of  premises.—(1)  The 

Commissioner may, subject to such conditions as may be prescribed, require any dealer— 

(a) to produce before him such books of accounts, registers or documents, 

(b) to furnish such information relating to the stock of goods of, or purchases, sales or deliveries 

of goods by, the dealer or any other information relating to his business, 

as may be deemed necessary, for the purposes of this Act. 

(2) (a) All books of accounts, registers and documents relating to the stock of goods of, or purchases, 

sales and deliveries of goods by, any dealer, and 

(b) All goods kept in any place of business or warehouse of any dealer, 

shall at all reasonable times be open to inspection by the Commissioner and the Commissioner may take 
or cause to be taken such copies or extracts of the said books of accounts, registers or documents and such 
inventory of the goods found as appear to him necessary for the purposes of this Act. 

(3)  Where  the  Commissioner,  upon  information  in his  possession  or otherwise,  has  reasonable 

grounds to believe that— 

(a) any person to whom a notice under this Act was issued to produce, or cause to be produced, 
any books of accounts or other documents has omitted or failed to produce or caused to be produced 
such books of accounts or other documents, as required by such notice, or 

(b)  any  person  to  whom  a  notice  as  aforesaid  has  been  or  might  be  issued,  will  not,  or           
would  not  produce  or  cause  to  be  produced  any  books  of  accounts  or other documents  which          
will  be  useful  for,  or  relevant  to,  any  proceedings  under  the Bengal  Finance  (Sales  Tax)                   
Act, 1941 (Bengal Act VI of 1941), as it was in force in Delhi, or under this Act, 

(c)  books  of  accounts,  registers  or  documents  of  any  dealer  may  be  destroyed,  mutilated,      
altered,  falsified  or  secreted  or  any  sales  by  that  dealer  have  been  or  may  be  suppressed, with  a      
view 
to  evade  payment  of 
(Sales Tax) Act, 1941 (Bengal Act VI of 1941), as it was in force in Delhi, or under this Act, 

to  evade  or  attempt 

tax  due  under 

the Bengal  Finance                            

24 

 
the  Commissioner  or  any other person  appointed  under sub-section  (2)  of  section 9,  if  so  authorised  by 
the Commissioner may, — 

(i) enter and search any building or place where he has reason to suspect that books of accounts 

and other documents or the sale proceeds are kept; 

(ii) break open the lock of any door, box, locker, safe, almirah or other receptacle for exercising 

the powers conferred by clause (i) where the keys thereof are not available; 

(iii) seize any such books of accounts or other documents or any inventory of goods as appear to 

him necessary for the purposes of this Act; 

(iv) place marks of identification on any books of accounts or other documents or make or cause 

to be made extracts or copies therefrom; 

(v) make a note or any inventory of any such money or goods found as a result of such search; 

(vi)  seal  the  premises  including  the  office, shop,  godown,  box,  locker,  safe,  almirah 
or other receptacle if the owner or the person in occupation or in charge of such office, shop, godown, 
box, locker, safe, almirah or other receptacle leaves the place or is not available or fails or refuses to 
open it when called upon to do so. 

(4) The Commissioner may requisition the services of any police officer or any public servant, or of 

both to assist him for all or any of the purposes specified in sub-section (3). 

(5)  Where  the  Commissioner  seizes  any  books  of  accounts  or other documents, he shall  give  the 
dealer  or  the  person  present  on his  behalf,  as  the  case  may  be,  a  receipt  for  the  same  and  obtain 
acknowledgement of the receipt so given to him: 

that 

Provided 

the  books  of  accounts 
or other documents are  seized  refuses  to  give  an  acknowledgement,  the  Commissioner  may  leave  the 
receipt at the premises and record this fact: 

the  dealer  or  person 

from  whose  custody 

if 

Provided  further  that  the  dealer  or  person  aforesaid  may  file  objections  before  the  Commissioner 

against such search, seizure or inventory within seven days of such search seizure or inventory. 

(6) The Commissioner shall keep in his custody the books of accounts, registers or documents seized 
under sub-section (3) for such period not later than the completion of all the proceedings under this Act in 
respect of years for which those books of accounts, registers or documents are relevant, as he considers 
necessary,  and thereafter shall  return  the  same  to the  dealer  or  any other person  from  whose  custody  or 
power they were seized: 

Provided that the Commissioner may, before returning such books of accounts or other documents as 
aforesaid,  place  or  cause  to  be  placed  such  marks  of  identification  thereon  as  appear  to him  to  be 
necessary: 

that 

Provided  further 

the  books  of  accounts 
the  Commissioner  may,  before  returning 
and other documents,  require  that  the  dealer  or  the  person,  as  the  case  may  be, shall  give  a  written 
undertaking that the books of accounts and other documents shall be presented whenever required by any 
competent authority for any proceedings under this Act. 

(7)  Save  as otherwise  provided  in  this  section,  every  search  or  seizure  made  under  this 
the  Code  of  Criminal 

section shall be  carried  on 
Procedure, 1973 (2 of 1974), relating to searches or seizures made under that Code. 

in  accordance  with 

the  provisions  of 

(8) The Commissioner may, for the purposes of this Act— 

(a) require any person, including a banking company, post office or any officer thereof, to furnish 
information  in  relation  to  such  points  or  matters  or  to  furnish  statements  of  accounts  and  affairs 
verified in the  manner  specified  by him,  giving  information  in  relation  to  such points  or  matters as 
in his opinion will be useful for, or relevant to, any proceeding under this Act; 

25 

 
 
 
(b) require any person— 

(i) who transports or holds in custody, for delivery to or on behalf of any dealer any goods to 
give  any  information  likely  to  be  in his  possession  in  respect  of  such  goods  or  to  permit 
inspection thereof, as the case may be; 

(ii)  who  maintains  or  has  in his  possession  any  books  of  accounts,  registers  or  documents 
relating to the business of a dealer to produce such books of accounts, registers or documents for 
inspection. 

42.  Power  of  Commissioner  and  other  authorities  to  take  evidence  on  oath,  etc.—(1)  The 
Commissioner  or  any  person  appointed  under sub-section  (2)  of  section 9 to  assist him shall,  for  the 
purposes  of  this  Act,  have  the  same  powers  as  are  vested  in  a  court  under  the  Code  of  Civil 
Procedure, 1908 (5 of 1908), when trying a suit, in respect of the following matters, namely:— 

(a) enforcing the attendance of any person and examining him on oath or affirmation; 

(b) compelling the production of accounts and documents; and 

(c) issuing commissions for the examination of witnesses, 

and  any  proceeding  under 
under  sub-section  (2)  of  section 9 to  assist him shall  be  deemed  to  be  a  judicial  proceeding  within 
the meaning  of 
Penal Code (45 of 1860). 

sections 193 and 228 and 

the  purposes  of 

this  Act  before 

section 196 of 

the 

for 

the  Commissioner  or  any  person  appointed                          

Indian                        

(2) Subject to any rule made in this behalf, any authority referred to in sub-section (1) may impound 
and  retain  in  its  custody  for  such  period  as  it  thinks  fit,  any  books  of  accounts  or other documents 
produced before it in any proceedings under this Act: 

Provided that a person appointed under sub-section (2) of section 9 to assist the Commissioner shall 

not— 

(a)  impound  any  books  of  accounts  or other documents  without  recording his  reasons  for  so 

doing; or 

(b) retain in his custody any such books or documents for a period exceeding thirty days, 

without obtaining the approval of the Commissioner therefor. 

CHAPTER VIII 

APPEALS, REFERENCE AND REVISION 

43.  Appeals.—(1)  Any  person  aggrieved  by  any order,  not  being  an order mentioned 
section 44 passed under this Act or the rules made thereunder, may appeal to the prescribed authority: 

in 

Provided that where an order, not being an order mentioned in section 44 or made under section 47 is 

passed by the Commissioner, the person aggrieved may appeal therefrom to the Appellate Tribunal. 

(2)  The  Commissioner  or  any  person  aggrieved  by  an order  passed  in  appeal  by  the  prescribed 

authority may appeal to the Appellate Tribunal against such order. 

(3) Subject to the provisions of section 62, no appeal shall be entertained unless it is filed within sixty 

days from the date of service of the order appealed against. 

(4) Every appeal filed under this section shall be in the prescribed form and shall be verified in the 
prescribed manner and in the case of an appeal to the Appellate Tribunal filed by any person other than 
the Commissioner, shall be accompanied by a fee of fifty rupees. 

(5) No appeal against an order of assessment with or without penalty or against an order imposing the 
penalty shall be entertained by an appellate authority unless such appeal is accompanied by a satisfactory 
proof of the payment of tax with or without penalty or, as the case may be, of the payment of the penalty 
in respect of which the appeal has been preferred: 

26 

 
Provided  that  the  appellate  authority  may,  if  it  thinks  fit,  for  reasons  to  be  recorded  in  writing, 

entertain an appeal against such order— 

(a) without payment of the tax and penalty, if any, or as the case may be, of the penalty, on the 

appellant furnishing in the prescribed manner security for such amount as it may direct, or 

(b) on proof of payment of such smaller sum, with or without security for such amount of tax or 

penalty which remains unpaid, as it may direct: 

Provided further that no appeal shall be entertained by the appellate authority unless it is satisfied that 

such amount of tax as the appellant may admit to be due from him has been paid. 

(6) The appellate authority may, after giving the appellant an opportunity of being heard,— 

(a) confirm, reduce, enhance or annul the assessment (including any penalty imposed), or 

(b) set aside the assessment (including any penalty imposed) and direct the assessing authority to 

make a fresh assessment after such further inquiry as may be directed, or 

(c) pass such order as it may think fit. 

(7) Save as provided in section 45, an order passed by Appellate Tribunal on appeal shall be final. 

44. Non-appealable orders.—No appeal and no application for revision shall lie against— 

(a) a notice issued under this Act calling upon a dealer for assessment or asking a dealer to show 

cause as to why he should not be prosecuted for an offence under this Act; or 

(b)  an order  pertaining 

to 

the  seizure  or  retention  of  books  of  accounts,  register 

and other documents; or 

(c) an order sanctioning prosecution under this Act; or 

(d) an interim order passed in the course of any proceedings under this Act. 

45. Statement of case to the High Court.—(1) Within sixty days from the date of an order passed by 
the  Appellate  Tribunal  under sub-section  (6)  of  section 43,  the  dealer  or  the  Commissioner  may,  by 
application  in  writing,  and  accompanied,  where  the  application  is  made  by  a  dealer,  by  a  fee  of  fifty 
rupees, require the Appellate Tribunal to refer to the High Court any question of law arising out of such 
order,  and, subject to  the other provisions  contained  in  this  section, the  Appellate  Tribunal shall,  within 
one hundred and twenty days of the receipt of such application, draw up a statement of the case and refer 
it to the High Court: 

Provided that the Appellate Tribunal may, if it is  satisfied that the dealer or the Commissioner was 
prevented  by  sufficient  cause  from  presenting  the  application  within  the  period  hereinbefore  specified, 
allow it to be presented within a further period not exceeding thirty days. 

(2) If the Appellate Tribunal refuses to state the case which it has been required to do, on the ground 
that no question of law arises, the dealer or the Commissioner, as the case may be, within thirty days of 
the communication of such refusal either withdraw his application (and if he does so, any fee paid shall be 
refunded), or apply to the High Court against such refusal. 

(3)  If  upon  receipt  of an  application  under sub-section  (2), the High  Court  is  not  satisfied  as to  the 
correctness of the decision of the Appellate Tribunal, it may require the Appellate Tribunal to state the 
case and refer it, and on receipt of such requisition, the Appellate Tribunal shall state the case and refer it 
accordingly. 

(4) If the High Court is not satisfied that the statement in a case referred to it are sufficient to enable it 
to determine the questions raised thereby, the Court may refer the case back to the Appellate Tribunal for 
the purpose of making such additions thereto or alternations therein as it may direct in that behalf. 

(5) The High Court upon the hearing of any such case shall decide the question of law raised thereby, 
and shall  deliver  its  judgment  thereon  containing  the  grounds  on  which  such  decision  is  founded, 
and shall  send  to  the  Appellate  Tribunal  a  copy  of  such  judgment  under  the  seal  of  the  Court  and  the 
signature of the Registrar, and the Appellate Tribunal shall dispose of the case accordingly. 

27 

 
(6) Where a reference is made to the High Court under this section, the costs [which shall not include 

the fee referred to in sub-section (1)] shall be in the discretion of the Court. 

(7) The payment  of the  amount  of tax  and  penalty  (if any)  due in  accordance with the order  of  the 
Appellate Tribunal in respect of which an application has been made under sub-section (1) shall not  be 
stayed pending the disposal of such application or any reference made in consequence thereof but if such 
amount is reduced as a result of such reference, the excess tax paid shall be refunded in accordance with 
the provisions of section 30. 

46. Revision of orders prejudicial to revenue.—The Commissioner may call for and examine the 
records of any proceeding under this Act and if he considers that any order passed therein by any person 
appointed under sub-section (2) of section 9 to assist him, is erroneous in so far as it is prejudicial to the 
interests of revenue, he may, after giving the dealer an opportunity of being heard and after making or 
causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of 
the case justify, including an order enhancing or modifying the assessment and penalty (if any) imposed 
or cancelling the assessment and penalty (if any) imposed and directing a fresh assessment: 

Provided that a final order under this section shall be made before the expiry of five years from the 

date of the order sought to be revised. 

47.  Revision  of  other  orders.—(1)  In  the  case  of  any order, other than  an order  referred  to  in 
section 44 or  to  which  section 46 applies,  passed  by  a  person  appointed  under sub-section  (2)  of 
section 9 to  assist him,  the  Commissioner  may,  either  on his  own  motion  or  on  an  application  filed  in 
accordance with such rules as may be prescribed, call for the record of any proceeding under this Act in 
which  any  such order  has  been  passed  and  may  make  such  inquiry  or  cause  such  inquiry  to  be  made 
and, subject to the provisions of this Act, may pass such orders thereon, not being an order prejudicial to 
the dealer, as he thinks fit: 

Provided that the Commissioner shall not revise any order under this sub-section,— 

(a)  where  an  appeal  against  the order  is  pending  before  the  appellate  authority  under     

section 43; or 

(b) where, if such appeal lies, the time within which it may be filed has not expired, or 

(c) where in the case of the second appeal, the dealer has not waived his right of appeal. 

(2) The Commissioner shall not on his own motion revise any order under this section after the expiry 

of two years from the date of the order sought to be revised. 

(3) In the case of an application for revision under this section by the dealer, the application shall be 
made within two years from the date on which the order in question was communicated to him or the date 
on which he otherwise comes to know of it, whichever is earlier. 

48.  Rectification  of  mistakes.—(1)  The  Commissioner  or 

any  person 

appointed                   

under sub-section  (2)  of  section 9 to  assist him,  may  at  any  time  within  two  years  from  the  date               
of  any order  passed  by  the  Commissioner  or  by  that  person,  as  the  case  may  be,  on his  own  motion, 
rectify  any  mistake  apparent  from  the  record,  and shall  within  a  like  period,  rectify  any  such  mistake 
which has been brought to his notice by any person affected by such order: 

Provided that no such rectification shall be made, if it has the effect of enhancing the tax or reducing 
the  amount  of  refund,  unless  the  Commissioner  or  the  person  appointed  under sub-section  (2)  of 
section 9 to assist him, as the case may be, has given notice in writing to the person likely to be affected 
by  the order  of his  intention  to  do  so  and  has  allowed  such  person  a  reasonable  opportunity  of  being 
heard. 

(2)  The  provisions  of sub-section  (1) shall  apply  to  the  rectification  of  a  mistake  by  an  appellate 

authority under section 43 as they apply to the rectification of a mistake by the Commissioner. 

28 

 
 
 
(3)  Where  any  matter  has  been  considered  and  decided  in  any  proceeding  by  way  of  appeal  or 
revision  relating  to  an order  referred  to  in sub-section  (1)  or sub-section  (2),  the  authority  passing 
such order  may,  notwithstanding  anything  contained  in  any  law  for  the  time  being  in  force,  amend 
the order under sub-section (1) or sub-section (2), as the case may be, in relation to any matter other than 
the matter which has been so considered and decided. 

(4)  Where  any  such  rectification  has  the  effect  of  reducing  the  amount  of  the  tax  or  penalty,  the 

Commissioner shall, in the prescribed manner, refund any amount due to such person. 

(5)  Where  any  such  rectification  has  the  effect  of  enhancing  the  amount  of  the  tax  or  penalty  or 
reducing the amount of the refund, the Commissioner shall recover the amount due from such person in 
the manner provided for in Chapter V. 

(6)  Save  as  provided  in  the  foregoing sub-sections,  and subject  to  such  rules  as  may  be  prescribed, 
any  assessment  made  or order  passed  under  this  Act  or  the  rules  made  thereunder  by  any  person 
appointed  under  section 9 or  by  the  Appellate  Tribunal  may  be  reviewed  by  such  person  or  by  the 
Appellate Tribunal, as the case may be, suo motu or upon an application made in that behalf. 

(7) Before  any order  is  passed  under sub-section  (6)  which  is  likely  to  affect  any  person  adversely, 

such person shall be given a reasonable opportunity of being heard. 

49. Determination of disputed questions.—(1) If any question arises, otherwise than in proceedings 
before a court, or before the Commissioner has commenced assessment or reassessment of a dealer under 
section 23 or 24, whether for the purposes of this Act,— 

(a) any person, society, club or association or any firm or any branch or department of any firm is 

a dealer; or 

(b)  any  particular  thing  done  to  any  goods  amounts  to  or  results  in  the  manufacture  of  goods 

within the meaning of that term as given in clause (h) of section 2; or 

(c) any transaction is a sale, and if so, the sale price therefor; or 

(d) any particular dealer is required to be registered; or 

(e) any tax is payable in respect of any particular sale, or if the tax is payable, the rate thereof, 

the  Commissioner shall,  within  such  period  as  may  be  prescribed,  make  an order  determining  such 
question. 

Explanation.—For  the  purposes  of  this sub-section,  the  Commissioner shall  be  deemed  to  have 
commenced  assessment  or  reassessment  of  a  dealer  under  section 23 or  section 24, when  the  dealer  is 
served with any notice by the Commissioner under section 23 or section 24 as the case may be. 

(2) The  Commissioner  may  direct  that  the  determination shall  not  affect  the  liability  of  any  person 

under this Act as respects any sale effected prior to the determination. 

(3)  If  any  such  question  arises  from  any order  already  passed  under  this  Act  or  under  the Bengal 
Finance (Sales Tax) Act, 1941 (Bengal Act VI of 1941), as then in force in Delhi, no such question shall 
be entertained for determination under this section; but such question may be raised in appeal against, or 
by way of revision of such order. 

CHAPTER IX 

OFFENCES AND PENALTIES 

50. Offences.—(1) Whoever— 

(a)  holds,  gives,  produces  or  accepts  a  declaration  under  the  second  proviso  to  clause  (a)             

of sub-section (2) of section 4, or under the first proviso to section 5, which he knows or has reason to 
believe to be false; or 

(b)  carries  on  business  as  a  dealer  without  obtaining  a  certificate  of  registration  as  required 

under sub-section (1) of section 14 or sub-section (1) of section 17; or 

29 

 
(c)  not  being  a  registered  dealer,  represents  when  purchasing  goods  that  he  is  a  registered      

dealer or; 

(d) being a registered dealer, represents when purchasing any goods or class of goods not covered 

by his certificate of registration, that such goods or class of goods are covered by such certificate; or 

(e) fails to comply with the provisions of sub-section (5) of section 20; or 

(f)  fails  to submit  any  return  as required  by sub-section  (2)  of section 21 by  the  prescribed  date 

or submits a false return; or  

(g) not being a registered dealer, collects any amount by way of tax under this Act or make any 

collection of such tax otherwise than in accordance with this Act or the rules made thereunder; or 

(h)  fails  to  keep  a  true  account  of  the  value  of  goods  bought  or  sold  by him  as  required  by 
section 38,  or  fails  when  required  so  to  do  under  that  section,  to  keep  any  account  or  record  of 
purchases or sales specified in any notice or notification referred to in that section; or 

(i) fails or neglects to issue cash memorandum or bills as required under section 39; or  

(j)    knowingly  maintains  or  produces  incorrect  accounts,  registers  or  documents  or  knowingly 

furnishes incorrect information; or 

(k) neglects to furnish any information required by section 40; or 
(l) refuses to comply with any requirements made of him under section 41; or 

(m) closes his place of business with a view to preventing inspection under section 41; or 

(n)  obstructs  or  prevents  any  officer  making  inspection,  search  or  seizure  under  section  41,  or 

performing any functions under section 64, as the case may be; or 

 (o) being the owner or person in charge of a goods vehicle fails, neglects or refuses to comply 

with any of the requirements contained in section 64; or 

(p) aids or abets any person in the commission of any offence specified in clauses (a) to (o), 

shall be punishable with rigorous imprisonment for a term which may extend to six months or with fine, 
or  with  both,  and  where  the  offence  is  a  continuing  one,  with  a  daily  fine  not  exceeding  two  hundred 
rupees during the period of the continuance of the offence: 

Provided that no prosecution for an offence under this Act shall be instituted in respect of the same 
facts in respect of which a penalty has been imposed under sub-section (6) of section 20, sub-section (6) 
of section 23, section 55, section 56 or section 57: 

Provided further that a person shall not be deemed to have committed an offence under clause (b) if 
he  had  applied  for  registration  under  this  Act  in  accordance  with  the  provisions  of sub-section  (2)  of 
section 14, or sub-section (2) of section 17, as the case may be. 

(2)  Notwithstanding  anything  contained in sub-section  (1),  if  any  person  commits an  offence  under 
clause (a) or clause (f) or clause (j) or clause (l) or clause (m) or clause (o) of that sub-section and the 
court  is  satisfied  that  the  offence  has  been  committed  wilfully,  he shall  be  punishable  with  rigorous 
imprisonment  for  a  term  which  may  extend  to  six  months  and  with  fine,  and  where  the  offence  is  a 
continuing one, with a daily fine not exceeding three hundred rupees during the period of the continuance 
of the offence. 

51.  Offences  by  companies.—(1)  Where  an  offence  under  this  Act  has  been  committed  by  a 
company, every person who at the time the offence was committed, was in charge of, and was responsible 
to, the company for the conduct of the business of the company, as well as the company, shall be deemed 
to be guilty of the offence and shall be liable to be proceeded against and punished accordingly: 

Provided  that  nothing  contained  in  this sub-section shall  render  any  such  person  liable  to  any 
punishment provided in this Act, if he proves that the offence was committed without his knowledge or 
that he exercised all due diligence to prevent the commission of such offence. 

30 

 
(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been 
committed  by  a  company  and  it  is  proved  that  the  offence  has  been  committed  with  the  consent  or 
connivance  of,  or  that  the  commission  of  the  offence  is  attributable  to  any  neglect  on  the  part  of  any 
director,  manager,  secretary  or other officer  of  the  company,  such  director,  manager,  secretary 
or other officer shall  also  be  deemed  to  be  guilty  of  that  offence  and shall  be  liable  to  be  proceeded 
against and punished accordingly. 

Explanation.—For the purposes of this section,— 

(a)  “company” means  a  body corporate,  and 

includes  a 

firm  or other association  of        

individuals; and 

(b) “director”, in relation to a firm, means a partner in the firm. 

52.  Cognizance  of  offences.—(1)  No  court shall  take  cognizance  of  any  offence  under  this  Act  or 
rules  made  thereunder  except  with the  previous sanction  of  the  Commissioner, and  no court inferior  to 
that of a Metropolitan Magistrate shall try any such offence. 

(2)  Notwithstanding  anything  contained  in  the  Code  of  Criminal  Procedure, 1973 (2 of 1974),  all 

offences punishable under this Act or rules made thereunder shall be cognizable and bailable. 

53.  Investigation  of  offences.—(1) Subject  to  such  conditions  as  may  be  prescribed,  the 
Commissioner  may  authorise  either  generally  or  in  respect  of  a  particular  case  or  class  of  cases  any 
person appointed under sub-section (2) of section 9 to assist him to investigate all or any of the offences 
punishable under this Act. 

(2)  Every  person  so  authorised shall,  in  the  conduct  of  such  investigation  exercise  the  powers 
conferred  by  the  Code  of  Criminal  Procedure, 1973 (2 of 1974),  upon  an  officer  in  charge  of  a  police 
station for the investigation of a cognizable offence. 

54.  Composition  of  offences.—(1) Subject  to  such  conditions  as  may  be  prescribed,  the 
Commissioner  may  accept,  from  any  person  alleged  to  have  committed  an  offence  under  section 50 or 
under any rules made under this Act, either before or after the commencement of any proceedings against 
such  person  in  respect  of  such  offence,  by  way  of  composition  for  such  offence,  a  sum  not  exceeding   
five  thousand  rupees  or  where  the  offence  alleged  to  have  been  committed  is  under  any  of  the                 
clauses  (a),  (b),  (c),  (d)  and  (f)  of  that  section,  not  exceeding  three  times  the  amount  of  the  tax  which 
would thereby have been avoided, whichever is higher. 

(2)  On  payment 
under sub-section (1),— 

in  full  of  such  sum  as  may  be  determined  by 

the  Commissioner                    

(a) no proceedings shall be commenced against such person as aforesaid; and 

(b)  if  any  proceedings  have  already  been  commenced  against  such  person  as  aforesaid,  such 

proceedings shall not be further proceeded with. 

55. Imposition of Penalty.—(1) If a dealer fails without reasonable cause to furnish any return by the 
prescribed  date  as  required  under sub-section  (2)  of  section 21,  or  to  pay  the  tax  due  according  to  the 
return  as  required  by sub-section  (3)  of  that  section,  the  Commissioner  may  after  giving  the  dealer  an 
opportunity of being heard, direct that the dealer shall pay, by way of penalty, in addition to the amount of 
tax payable, a sum not exceeding twice that amount or where no tax is payable a sum not exceeding two 
thousand rupees. 

(2)  The  penalties  specified  under sub-section  (1)  may  be  imposed  by  the  Commissioner 
notwithstanding  the  fact  that  assessment  proceedings  have  not  been  initiated  against  the  dealer  under 
section 23. 

56.  Penalty  for  concealment  of  sales  or  furnishing  inaccurate  particulars  or  making  false 
representations.—(1) If the Commissioner or any person appointed under sub-section (2) of section 9 to 
assist him,  in  the  course  of  any  proceedings  under  this  Act,  is  satisfied  that  a  dealer  has  concealed  the 
particulars of his sales or has furnished inaccurate particulars of his sales, he may, after giving the dealer a 
reasonable opportunity of being heard, direct that the dealer shall pay, by way of penalty, in addition to 

31 

 
the  amount  of  tax  payable,  a  sum  not  exceeding  two  and  a  half  times  the  amount  of  tax  which  would 
thereby have been avoided. 

(2) If a person commits an offence under clause (a) of section 50, the Commissioner or any person 
appointed  under sub-section  (2)  of  section 9 to  assist him  may,  after  giving  that  person  a  reasonable 
opportunity of being heard, by order in writing, impose upon such person by way of penalty, a sum not 
exceeding two and a half times the amount of tax which would thereby have been avoided. 

(3) If a person purchasing goods commits an offence under clause (c) or clause (d) of section 50, the 
authority which granted him, or, as the case may be, is competent to grant him a certificate of registration 
under this Act, may, after giving him a reasonable opportunity of being heard by order in writing impose 
upon him by way of penalty, a sum not exceeding two and a half times the tax which could have been 
levied under this Act in respect of the sale to him of the goods, if the offence had not been committed. 

57.  Penalty  for  contravening  provisions  regarding  collection  of  tax  by  dealers.—If  any  person 
acts in contravention of the provisions of section 22, he shall be liable to a penalty not exceeding two and 
a half times the tax wrongly collected: 

Provided that the Commissioner shall not impose such penalty unless the person concerned has been 

given an opportunity of being heard. 

CHAPTER X 

MISCELLANEOUS 

58. Service of notice when family is disrupted or firm is dissolved.—(1) Where a Hindu undivided 
family has been partitioned, notices under this Act may be served on the person who was the last manager 
of the Hindu family, or if such person cannot be found, then on all adults who were members of the Hindu 
family, immediately before the partition. 

(2) Where a firm or an association of persons is dissolved, notices under this Act may be served on 
any person who was a partner (not being a minor) of the firm, or member of the association, as the case 
may be, immediately before its dissolution. 

59. Service of notice in the case of discontinued business.—Where an assessment is to be made in 
respect of business which has been discontinued, a notice under this Act shall be served in the case of a 
firm or an association of persons on any person who was a member of such firm or association at the time 
of its discontinuance or in the case of a company on the principal officer thereof. 

60. Appearance before any authority in proceedings.—(1) Any person, who is entitled or required 

to attend before any authority in connection with any proceedings under this Act, may attend,— 

(a) by a person authorised by him in writing in this behalf, being a relative or a person regularly 

employed by him; or 

(b)  by  a  legal  practitioner  or  chartered  accountant  who  is  not  disqualified  by  or  under                     

sub-section (2); or 

(c) by a sales tax practitioner who possesses the prescribed qualifications and is entered in the list 
which  the  Commissioner  shall  maintain  in  that  behalf,  and  who  is  not  disqualified  by  or  under       
sub-section (2). 

(2) The Commissioner may, by order in writing and for reasons to be recorded therein, disqualify for 
such  period  as  is  stated  in  the  order  from  attending  before  any  such  authority  any  legal  practitioner, 
chartered accountant or sales tax practitioner— 

(i) who has been removed or dismissed from Government service; or 

(ii)  who  being  a  legal  practitioner  or  chartered  accountant  is  found  guilty  of  misconduct  in 
connection  with  any  proceedings  under  this  Act  by  an  authority  empowered  to  take  disciplinary 
action against the members of the profession to which he belongs; or 

(iii) who being a sales tax practitioner is found guilty of such misconduct by the Commissioner. 

32 

 
(3) No order of disqualification shall be made in respect of any particular person unless he has been 

given a reasonable opportunity of being heard. 

(4) Any person against whom any order of disqualification is made under this section may, within one 
month  of  the  date  of  communication  of  such  order,  appeal  to  the  Administrator  to  have  the  order 
cancelled. 

(5)  The  order  of  the  Commissioner  shall  not  take  effect  until  one  month  of  the  making  thereof  or 

when an appeal is preferred, until the appeal is decided. 

(6)  The  Commissioner  may  at  any  time  suo  motu  or  on  an  application  made  to  him  in  this  behalf, 
revoke any order made against any person under sub-section (2) and thereupon such person shall cease to 
be disqualified. 

61. Change of an incumbent of an office.—Whenever in respect of any proceeding under this Act 
the  Commissioner  or  any  person  appointed  under sub-section  (2)  of  section 9 to  assist him,  ceases  to 
exercise  jurisdiction  and  is  succeeded  by another who  has  and  exercises  jurisdiction,  the  person  so 
succeeding  may  continue  the  proceeding  from  the  stage  at  which  the  proceeding  was  left  by his 
predecessor: 

Provided  that  the  dealer  concerned  may  demand  that  before  the  proceeding  is  so  continued,  the 
previous  proceeding  or  any  part  thereof  be  reopened  or  that  before  any order  of  assessment  is  passed 
against him, he be re-heard. 

62. Extension of period of limitation in certain cases.—(1) An Appellate authority may admit an 
appeal under section 43 after the period of limitation laid down in that section, if the appellant satisfies 
the appellate authority that he has sufficient cause for not preferring the appeal within such period. 

(2)  In  computing  the  period  laid  down  under  sections 43, 45, 46 and 47,  the  provisions  of 

sections 4 and 12 of the Limitation Act, 1963 (36 of 1963), shall, so far as may be, apply. 

(3) In computing the period of limitation prescribed by or under any provision of this Act, or the rules 
made thereunder, other than section 43, 45, 46 or 47, any period during which any proceeding is stayed by 
an order or injunction of any court shall be excluded. 

63.  Returns,  etc.,  to  be confidential.—(1)  All particulars  contained  in  any  statement  made,  return 
furnished or accounts or documents produced in accordance with this Act, or in any record of evidence 
given  in  the  course  of  any  proceedings  under  this  Act, other than  proceedings  before  a  criminal 
court, shall, save as provided in sub-section (3), be treated as confidential, and notwithstanding anything 
contained  in  the  Indian  Evidence  Act, 1872 (1 of 1872),  no  court shall,  save  as  aforesaid,  be  entitled  to 
require any servant of the Government to produce before it any such statement, return, account, document 
or record or any part thereof, or to give evidence before it in respect thereof. 

(2)  If,  save  as  provided  in sub-section  (3),  any  servant  of  the  Government  discloses  any  of  the 
particulars referred to in sub-section (1), he shall be punishable with imprisonment which may extend to 
six months, and shall also be liable to fine. 

(3) Nothing in this section shall apply to the disclosure— 

(a)  of  any  of  the  particulars  referred  to  in sub-section  (1)  for  the  purposes  of  investigation  or 
prosecution under this Act or the Indian Penal Code (45 of 1860) or any other enactment for the time 
being in force; or 

(b)  of  such  facts  to  an  officer  of  the  Central  Government  or  any  State  Government  as  may  be 
necessary  for  verification  of  such  facts  or  for  the  purposes  of  enabling  that  Government  to  levy  or 
realise any tax imposed by it; or 

(c) of any such particulars where such disclosure is occasioned by the lawful employment under 

this Act of any process for the service of any notice or the recovery of any demand; or 

33 

 
 
 
(d) of any such particulars to a civil court in any suit or proceeding to which the Government or 
any sales tax authority is a party and which relates to any matter arising out of any proceeding under 
this  Act  or  under  any other law  for  the  time  being  in  force  authorizing  any  sales  tax  authority  to 
exercise any powers thereunder; or 

(e) of any such particulars by any public servant where the disclosure is occasioned by the lawful 
exercise  by him  of his  powers  under  the  Indian  Stamp  Act, 1899 (2 of 1899),  to  impound  an 
insufficiently stamped document; or 

(f) of any such particulars to the Reserve Bank of India as are required by that Bank to enable it to 

compile financial statistics of international investment and balance of payment; or 

(g) of any such particulars to any officer appointed by the Comptroller and Auditor-General of 

India for purpose of audit of tax receipts or refunds; or 

(h) of any such particulars relevant to any inquiry into a charge of misconduct in connection with 
income-tax  proceedings  against  a  legal  practitioner  or  chartered  accountant,  to  the  authority 
empowered to take disciplinary action against members of the profession to which he belongs; or 

(i)  of  such  particulars  to  the  officers  of  the  Central  Government  or  any  State  Government  for 

such other purposes, as the Administrator may by general or special order direct. 

64.  Setting  up  of  check-posts  and  barriers.—(1)  The  Administrator  may,  by  notification  in  the 
Official Gazette, set up check-posts or barriers, or both, at any place in Delhi with a view to preventing 
evasion of tax and other dues payable under this Act. 

(2) The owner or person in charge of a goods vehicle shall carry with him a goods vehicle record, a 
trip  sheet  or  a  log  book,  as  the  case  may  be,  and  a  bill  of  sale  or  a  delivery  note  containing  such 
particulars as may be prescribed in respect of the goods carried in the goods vehicle and produce the same 
before any officer in charge of a check-post or barrier or any other officer as may be empowered by the 
Administrator in this behalf. 

(3)  The  owner  or  person  in  charge  of  a  goods  vehicle  entering  or  leaving  Delhi  shall  also  file  a 
declaration  containing  such  particulars  in  the  prescribed  form  obtainable  from  the  prescribed  authority 
and in such manner as may be prescribed, before the officer in charge of a check-post or barrier or before 
the other officer empowered as aforesaid: 

Provided that where the owner or person in charge of a goods vehicle after filing a declaration at the 
time  of  entering  Delhi  that  the  goods  are  meant  to  be  carried  to  a  place  outside  Delhi,  fails,  without 
reasonable cause, to carry such goods outside Delhi within the prescribed period, he shall, in addition to 
the payment of tax, if any, be liable to a penalty  not exceeding two and a half times the tax that would 
have been payable had the goods been sold inside Delhi or one thousand rupees, whichever is more. 

(4) At every check-post or barrier, or at any other place when so required by an officer empowered by 
the Administrator in this behalf, the driver or any other person in charge of a goods vehicle shall stop the 
vehicle  and  keep  it  stationary  so long  as  may  be  required  by  the  officer  in  charge  of the check-post  or 
barrier  or  the  officer  empowered  as  aforesaid  to  search  the  goods  vehicle  or  part  thereof,  examine  the 
contents therein and inspect all records relating to the goods carried, which are in the possession of such 
driver or other person in charge, who shall, if so required, give his name and address and the name and 
address of the owner of the vehicle as well as those of the consignor and consignee of the goods. 

(5) If on an examination of the contents in a goods vehicle or the inspection of records relating to the 
goods carried, any officer empowered by the Administrator in this behalf has reason to believe that the 
owner or person in charge of such goods vehicle is attempting to evade payment of the tax due under this 
Act, he may, for reasons to be recorded in writing and after hearing the owner or person in charge of the 
goods vehicle, detain the goods and the goods so detained shall not be allowed to be transported unless 
the owner, or his agent or the person in charge of the goods vehicle furnishes to the satisfaction of such 
officer security in such form and in such manner as may be prescribed for an amount not exceeding one 
thousand rupees or the amount of tax payable if such goods were sold in Delhi, whichever is more. 

34 

 
(6)  Where  the  security  required  to  be  furnished  under  sub-section  (5)  is  not  furnished  within  the 
prescribed period such goods shall be disposed of in such manner and subject to such conditions as may 
be prescribed. 

Explanation.—For the purposes of this section, “goods vehicle” shall include a motor vehicle, vessel, 

boat, animal and any other form of conveyance. 

65. Publication of names, etc., of dealers whose certificates of registration are cancelled.—The 
Commissioner shall,  at  intervals  not  exceeding  three  months,  publish  in  the  Official  Gazette  such 
particulars  as  may  be  prescribed  of  dealers  whose  certificates  of  registration  are  cancelled  under  the 
provisions of this Act. 

66. Exemptions.—(1) If the Administrator is of opinion that it is necessary or expedient in the public 
interest so to do, he may, with the previous approval of the Central Government, exempt, by notification 
in the Official Gazette, and subject to such conditions, if any, as he may impose, any specified class of 
sales by any specified class of dealers from payment of the whole or any part of the tax payable under this 
Act. 

(2) If in respect of any sales which are exempt from payment of tax under sub-section (1), a breach of 
any of the conditions subject to which such exemption was granted, is committed, the dealer responsible 
for such breach shall be liable to pay tax in respect of all such sales as if no such exemption had been 
granted. 

67. Bar of suits in civil courts.—No suit shall be brought in any civil court to set aside or modify 
any assessment made or any order passed under this Act or the rules made thereunder and no prosecution, 
suit or other proceeding shall lie against the Government or any officer of the Government for anything in 
good faith done or intended to be done under this Act or the rules made thereunder. 

68.  Transfers  during  pendency  of  proceedings  void.—Where,  during  the  pendency  of  any 
proceeding under this Act, any person creates a charge on or parts with the possession by way of sale, 
mortgage,  gift  or  exchange  or  any other mode  of  transfer  whatsoever,  of  any  of his  assets  in  favour  of 
any other  person,  such  charge  or  transfer shall  be  void  as  against  any  claim  in  respect  of  any  tax  or 
any other sum payable by such person as a result of the completion of the said proceedings. 

69.  Chapter  XXXVI  of  the  Code  of  Criminal  Procedure,  1973,  not  to  apply  to  certain  
offences.—Nothing  in  Chapter  XXXVI  of  the  Code  of  Criminal  Procedure, 1973 (2 of 1974), shall     
apply to— 

(i) any offence punishable under this Act; or 

(ii)  any other offence  which  under  the  provisions  of  that  Code,  may  be  tried  along  with  such 

offence, 

and every offence referred to in clause (i) or clause (ii) may be taken cognizance of by the court having 
jurisdiction under this Act as if the provisions of that Chapter were not enacted. 

70. Application of the provisions of the Delhi Land Reforms Act, 1954 for purposes of recovery 
of  sales  tax  recoverable  as  arrears  of  land  revenue.—For  the  purposes  of  recovery  of  any  amount 
recoverable  as  arrears  of  land  revenue  under  this  Act,  the  provisions  of  the  Delhi  Land  Reforms 
Act, 1954 (Delhi Act 8 of 1954), as to recovery of arrears of land revenue shall, notwithstanding anything 
contained  in  that  Act  or  in  any other enactment,  be  deemed  to  be  in  force  throughout  Delhi  and  the 
provisions of the Revenue Recovery Act, 1890 (1 of 1890), shall have effect accordingly. 

71. Power to make rules.—(1) The Administrator may make rules for carrying out the purposes of 

this Act. 

(2)  In  particular  and  without  prejudice  to  the  generality  of  the  foregoing  power,  such  rules  may 

provide for— 

(a)  the  further  period  after  the  date  of  expiry  of  three  consecutive  years  referred  to                 

in sub-section (3) of section 3 for which liability to pay tax of a dealer shall continue; 

35 

 
 
 
(b)  the  particulars  to  be  contained  in  a  declaration  under sub-clause  (v)  of  clause  (a)                    

of sub-section (2) of section 4, or under section 5, as the case may be, the form of such declaration, 
the authority from whom such forms shall be obtainable and the manner in which and the time within 
which such declaration is to be furnished. 

(c) the period of turnover, the manner in which the turnover in relation to sale of any goods under 
this Act shall be determined and the sales turnover which may be deducted under sub-clause (vi) of 
clause (a) of sub-section (2) of section 4; 

 (d) the restrictions and conditions subject to which the Commissioner may delegate his powers 

under section 10; 

(e)  the  authority  to  whom  applications  for  registration  under  sections 14, 15, 16 and 17 may  be 

made and the form of such applications and the fees payable in respect thereof; 

(f)  the  procedure  for  and other matters  incidental  to  registration  of  dealers,  the  granting  of 
certificates of registration, the period within which such certificates shall be granted and the forms of 
such certificates; 

(g) the intervals at which, and the manner in which, the tax under this Act shall be payable under 

section 21; 

(h)  the  returns  to  be  furnished  under sub-section  (2)  of  section 21 and  dates  by  which,  and  the 

authority to whom, such returns shall be furnished; 

(i) the procedure to be followed for assessment under section 23; 

(j) the circumstances in which, and the conditions subject to which, a dealer may be permitted to 

pay a lump sum by way of composition under section 29 and the manner of determining such sum; 

(k) the  form  in  which claims  for  refund  or  set-off  may  be  preferred,  the  manner  in  which  such 

claims for refund shall be verified and the refunds or set-off under this Act shall be allowed; 

(l) the authority to whom information shall be furnished under section 40; 

(m)  the  conditions  under  which  the  production  of  accounts  or  documents  or  the  furnishing  of 

information may be required under sub-section (1) of section 41; 

(n) the form and manner in which, and the authority to whom, appeals against assessment may be 
filed  under  section  43,  the  manner  in  which  such  appeals shall  be  verified  and  the  fees  payable  in 
respect thereof and the procedure, to be followed by such authority; 

(o)  the  form  and  manner  in  which  applications  for  revision  under  section 47 or  for  review 

under sub-section (5) of section 48 may be filed and the fee payable in respect thereof; 

(p)  the  conditions subject  to  which  the  Commissioner  may  authorise  the  persons  appointed 
under sub-section  (2)  of  section 9 to  assist him  to  investigate  offences  under sub-section  (1)  of 
section 53; 

(q) the conditions under which offences may be compounded under section 54; 
(r) the  manner  in  which, and  the time  within  which, applications shall  be  made  (including  fees 
payable in respect thereof), information furnished, securities given and notices served under this Act; 

(s) any other matter which is required to be, or may be, prescribed. 

(3) Any rules made under this Act may provide that a contravention thereof shall be punishable with 
fine  which  may  extend  to  five  hundred  rupees,  and  in  the  case  of  a  continuing  contravention,  with  an 
additional fine which may  extend to twenty-five rupees for every day during which such contravention 
continues after conviction for the first such contravention. 

72. Rules to be laid before Parliament.—Every rule made under this Act shall be laid, as soon as 
may be after it is made, before each House of Parliament, while it is in session, for a total period of thirty 
days  which  may  be  comprised in  one session or  in  two  or  more  successive  sessions,  and if,  before  the 
expiry of the session immediately following the session or the successive sessions aforesaid, both Houses 
agree in making any modification in the rule or both Houses agree that the rule should not be made, the 

36 

 
rule shall thereafter  have  effect  only  in  such  modified  form  or  be  of  no  effect, as  the  case  may  be;  so, 
however, that any such modification or annulment shall be without prejudice to the validity of anything 
previously done under that rule. 

73. Repeal and savings.—(1) The Bengal Finance (Sales Tax) Act, 1941 (Bengal Act VI of 1941), as 

in force in Delhi (hereinafter referred to as the said Act), is hereby repealed: 

Provided  that  such  repeal shall  not  affect  the  previous  operation  of  the  said  Act  or  any  right,  title, 
obligation or liability already acquired, accrued or incurred thereunder and subject thereto, anything done 
or any action taken including any appointment, notification, notice, order, rule, form or certificate in the 
exercise of any power conferred by or under the said Act shall be deemed to have been done or taken in 
the exercise of the powers conferred by or under this Act, as if this Act were in force on the date on which 
such  thing  was  done  or  action  was  taken,  and  all  arrears  of  tax  and other amounts  due  at  the 
commencement of this Act may be recovered as if they had accrued under this Act. 

(2) Any application for revision pending immediately before the date on which the Appellate Tribunal 
is  constituted  under  section 13 (hereafter  in  this  section  referred  to  as  the  notified  date),  before  the 
Commissioner under the Bengal Finance (Sales Tax) Act, 1941 (Bengal Act VI  of 1941), as in force in 
the Union territory of Delhi shall on such date stand transferred to, and be disposed of by the Tribunal: 

Provided that no application for revision shall be transferred to the Appellate Tribunal if the petitioner 
making the application for revision waives his right of appeal to the Tribunal within fifteen days after the 
notified date, in which case the application for revision shall be disposed of by the Commissioner as if it 
were an application for revision made under section 47. 

(3)  Any  application  for  revision,  pending  immediately  before  the  notified  date,  before  the 
Commissioner and transferred to the Appellate Tribunal under sub-section (2) shall be disposed of by the 
Appellate  Tribunal  as  if  it  were  an  appeal  made  to  the  Tribunal  under  and  in  accordance  with  the 
provisions of section 43 of this Act. 

(4)  Where  an  appeal  against  an order  passed  by  an  officer  under  this  Act  lies  to  the  Appellate 
Tribunal after the notified date, and the period of limitation specified for filing such appeal under this Act 
has not expired, then, such appeal shall lie to the Tribunal within thirty days of the notified date or within 
the expiry of the period of limitation specified for filing such appeal, whichever is later. 

74. Removal of difficulties.—(1) If any difficultly arises in giving effect to the provisions of this Act, 
the  Central  Government  may,  by  general  or  special  order  published  in  the  Official  Gazette,  make  such 
provisions not inconsistent with the provisions of this Act as appear to it to be necessary or expedient for 
the removal of the difficulty: 

Provided that no such order shall be made after the expiration of one year from the commencement of 

this Act. 

(2) Every order made under sub-section (1) shall be laid, as soon as may be after it is made, before 
each House of Parliament, while it is in session, for a total period of thirty days which may be comprised 
in one session or in two or more successive sessions, and if, before the expiry of the session immediately 
following the session or the successive sessions aforesaid, both Houses agree in making any modification 
in the order or both Houses agree that the order should not be made, the order shall thereafter have effect 
only in such modified form or be of no effect, as the case may be; so, however, that any such modification 
or annulment shall be without prejudice to the validity of anything previously done under that order. 

75. Transitional provisions.—Where a dealer liable to pay tax under the Bengal Finance (Sales Tax) 
Act, 1941 (Bengal Act VI of 1941), as in force in Delhi immediately before the commencement of this 
Act is not liable to pay tax under the provisions of this Act, he shall, notwithstanding the repeal of the 
first mentioned Act, continue to be liable to pay tax on the sales made by him after such commencement 
of all goods— 

(i) purchased by him before such commencement, 

(ii)  manufactured  by him  before  or  after  such  commencement  out  of  raw  materials  purchased 

before such commencement. 

37 

 
 
THE FIRST SCHEDULE 

[See section 4 (1) (a)] 

1. Motor vehicles, including chassis of motor vehicles, motor tyres and tubes, accessories, component 

parts and spare parts of motor vehicles and motor bodies. 

2. Motor cycle and motor and cycle combinations, motor scooters, motorettes and tyres and tubes, and 

accessories, component parts and spare parts of motor cycles, motor scooters and motorettes. 

3. Refrigerators, air-conditioning and other cooling appliances and apparatus including room coolers 

and water coolers and component parts, spare parts and accessories thereof. 

4.  Wireless  reception  instruments  and  apparatus,  radios  and  radio-gramophones,  television  sets, 
accumulators, amplifiers and loudspeakers and spare parts, component parts and accessories thereof, and 
electrical valves. 

5.  Cinematographic  equipment  including  cameras,  projectors  and  sound  recording  and  reproducing 
equipment, and spare parts, component parts and accessories required for use therewith, and lenses, films 
and cinema carbons. 

6. Photographic and other cameras and enlargers, lenses, films and plates, paper and other component 
parts,  spare  parts  and  accessories  required  for  use  therewith  including  photographic  chemicals  and 
photographs  but  excluding  X-ray  apparatus  and  films,  plates,  photographic  chemicals  and  other 
equipment  required  for  use  with  the  X-ray  apparatus  and  component  parts,  spare  parts  and  accessories 
thereof. 

7.  All  clocks,  time  pieces,  watches,  electrical  time  switches  and mechanical  timers  and  component 

parts, spare parts and accessories thereof. 

8.  All  arms  including  rifles,  revolvers,  pistols  and  ammunition  for  the  same,  and  component  parts,  

spare parts and accessories thereof. 

9. Cigarette cases and lighters. 

10. Dictaphone, tape-recorders and other similar apparatus for recording sound and component parts, 

spare parts and accessories thereof. 

11. Sound transmitting equipment including telephones and loudspeakers and component parts, spare 
parts and accessories thereof but excluding sound amplifying apparatus carried on the person and adapted 
for use as a hearing aid. 

12.  Typewriters,  tabulating,  calculating,  cash  registering,  indexing,  card  punching,  franking  and 
addressing  machines,  teleprinters  and  duplicating  machines  and  component  parts,  spare  parts  and 
accessories thereof. 

13. Binoculars, telescopes and opera glasses and component parts, spare parts and accessories thereof. 

14. Gramophones, record players, record changers and component parts, spare parts and accessories 

thereof and records and needles. 

15. All electronic and electrical goods other than torches, torch cells and filament lighting bulbs. 

16. Table cutlery including knives and forks, but not including spoons. 

17. All types of sanitary goods and fittings. 

18. (i) All goods made of glass but not including plain glass panes, optical lenses, hurricane lantern 
chimneys, phials, clinical syringes, thermometers, bangles and scientific apparatus and instruments made 
of glass. 

(ii) Glazed earthenware. 

(iii) Chinaware, including crockery. 

38 

 
 
 
19.  Vacuum  flasks  of  all  kinds  (including  thermoses,  thermic  jugs,  ice  buckets  or  boxes,  urns 

and other domestic receptacles to keep food or beverages hot or cold) and refills thereof. 

20. Liquor (foreign liquor and Indian-made foreign liquor). 

21. Picnic set sold as a single unit. 

22. Iron and steel safes and almirahs. 

23. Motor spirit, high speed diesel oil, aviation gasoline, aviation turbine fuel and all other varieties of 

fuel for motor vehicles and aircrafts. 

24. Cosmetics, perfumery and toilet goods including shampoos but not including  soap, tooth brush, 

tooth paste, tooth powder and kumkum. 

25. Leather goods excepting footwear, belts and sports articles made of leather. 

26. Furniture including iron and steel furniture. 

27. Sheets, cushions, pillows, mattresses and other articles made from foam rubber or plastic foam or 

other synthetic foam. 

28. Furs and articles of personal or domestic use made therefrom. 

29. Articles and wares made of stainless steel excluding safety razor blades and surgical instruments 

or parts of industrial machinery and plant. 

30. Perambulartors. 

31. Plastic, celluloid bakelite and goods and goods made of similar other substances but not including 

such goods of value not exceeding thirty rupees per piece. 

32. Fireworks including coloured matches. 

33. Lifts whether operated by electricity or hydraulic power. 

34. All types of glazed and vitrum tiles, mosaic tiles, laminated sheets like Sun mica, Formica, etc. 

__________ 

THE SECOND SCHEDULE 

[See section 4 (1) (b)] 

1. Coal including coke in all its forms. 

2. Cotton as defined in section 14 of the Central Sales Tax Act, 1956 (74 of 1956). 

3. Iron and steel as defined in section 14 of the Central Sales Tax Act, 1956 (74 of 1956). 

4. Jute as defined in section 14 of the Central Sales Tax Act, 1956 (74 of 1956). 

5. Oil seeds as defined in section 14 of the Central Sales Tax Act, 1956 (74 of 1956). 

6. Hides and skins, whether in a raw or dressed state. 

7. Cotton yarn as defined in section 14 of the Central Sales Tax Act, 1956 (74 of 1956), and cotton 

thread. 

39 

 
 
 
 
 
THE THIRD SCHEDULE 

(See section 7) 

1. All cereals and pulses including all forms of rice and their brans and cooked dal. 

2. Flour including atta, maida, besan and suji. 

3. Chapaties,  paranthas,  stuffed  paranthas,  puries,  stuffed  puries,  kulchas,  nans  and  bhaturas  and 

bread (double roti). 

4. Meat and fish other than canned, preserved, processed, dried, dehydrated or cooked. 

5. Fresh eggs. 

6. Vegetables, green or dried (except when sold in sealed containers) and vegetables seeds. 

7. Fruits other than dry fruits or canned, preserved, dried or dehydrated fruits. 

8. Sugar as defined in the Central Excises and Salt Act, 1944 (1 of 1944). 

9. Salt. 

10. Fresh milk (whole or separated) including boiled and sugared milk. 

11.  Edible  oils  produced  in  indigenous  kohlu  or  ghani  (without  employing  electricity  or  any  other 
power  at  any  stage)  when  sold  by  the  person  owning  such  indigenous  kohlu  or  ghani  and  dealing 
exclusively in the production of edible oils by such indigenous kohlu and ghani. 

12. Dahi and lassi. 

13. All varieties of cotton fabrics, rayon or artificial silk fabrics and woollen fabrics. 

Explanation.—The expression “cotton fabrics”, “rayon or artificial silk fabrics” and “woollen fabrics” 

shall  have  the  same  meanings  as  are,  respectively  assigned  to  them  in  the  Central  Excises  and  Salt                 
Act, 1944 (1 of 1944). 

14.  Books  and  periodicals,  maps,  educational  charts,  instruments  boxes  used  by  students  and 
educational globes and instruments, such as instruments used in mechanical drawing and biology, used by 
students. 

15. Fuel wood and charcoal. 

16. School exercise and drawing books. 

17. Agricultural implements including chaff cutters and  persian wheels or parts thereof and electric 

motors including monoblock pump sets of 3 to 7

  horse power. 

18. Cattle feeds, including fodder and poultry feeds. 

19. Electric energy. 

20. Fertilizers. 

21. Water but not aerated water or mineral water or water sold in bottles or sealed containers. 

22. Tobacco as defined under the Central Excises and Salt Act, 1944 (1 of 1944). 

23. (i) Country made shoes (Juties). 

When manufactured— 

(ii) Cane and bamboo handicrafts. 

(a) without the use of power, and  

(iii)  Earthen  wares  made  by 
Kumhars. 

(b)  at  a  place  other  than  a  factory  as  defined  in  the 
Factories Act, 1948 (63 of 1948) and sold either by 
the maker himself or by any member of his family or 
by  a  cooperative  society  consisting  wholly  of  the 
makers of such articles. 

24. Charkha, takli and charkha accessories. 

40 

 
 
 
25. Slate, slate pencils, takhties, black ink used for takhties, writing chalks, crayons (excluding colour 

pencils), foot-rules of the types used in schools and kalams (pens used for takhties). 

26. Betel leaves including prepared pans. 

27. Pesticides for plant protection. 

28. Plant protection machines. 

29. Ready-made garments of khadi made out of cloth certified as such under the Khaddar (Protection 

of Name) Act, 1950 (78 of 1950). 

30. Condoms. 

31. Blood for transfusion that is to say fresh human blood or plasma, liquid or dried. 

32. Handspun yarn. 

33. Achar and muraba except when sold in sealed containers. 

34. Scientific goods including scientific glass goods, geometrical and drawing goods used in Schools 

and Colleges for teaching and for use by students. 

35. Livestock including poultry. 

36. Cotton paddings. 

41 

 
